With the gradual advancement of the transformation of government functions in China, China's township governments have gradually withdrawn from the competitive and profitable fields in the market, but they have also cut off the channels for township governments to obtain income from the market. And with the continuous improvement of China's political and economic system and various reforms to safeguard farmers' rights and interests, the township government has been further caught in financial difficulties, the complete transformation of township government functions has been curbed, and even some rebound phenomena have appeared.

This paper summarizes the financial situation of the township government in the transitional period, analyzes the reasons for the financial difficulties of the township government, and expounds how to make the township government obtain strong finance to ensure the successful transformation of its functions.

The township government is the most basic government organization in China and the ultimate executor of the central policy. Therefore, the transformation of township government functions plays an important role in this historical process. At present, the transformation of township government functions in China is slow, and the key factor is the lack of necessary financial guarantee. A series of reforms to safeguard farmers' rights and interests have greatly reduced the financial resources of villages and towns, and providing public products and services needed for the transformation of township government functions has undoubtedly increased the government's public expenditure, which will inevitably restrict the further transformation of township government functions. Therefore, the transformation of township government functions must be based on a good financial situation.