There are not very many legitimate reasons for a person to use a VPN. Usually, these things are just done in order to skirt around security or firewall issues and do something that you're not supposed to be doing. The only group that needs to use a VPN is a government or business.
VPNs, or Very Private Networks, afford security to those concerned about having their personal data discovered or intercepted. Since Edward Snowden, VPN add-ons for a variety of different browsers have multiplied in number. They let users hide their IP addresses, access content that may be blocked in their country, and use public networks and mobile hotspots without compromising their data. China is famous for having rigid internet censorship, blocking everything from Facebook to the New York Times. VPNS offer Chinese citizens a vital connection to the outside world, one that enables them to circumvent government censorship.
I understand the need for the Chinese government to control their humongous population but restricting the internet is stupid. People aren't going to start rioting against the Party if have unfiltered access to Google. Now if you make it a crime to use a VPN and deprive people of browsing the internet how they want, then yes, you just may see rioting. Just let the people use the internet, it won't end the world!
Chinese citizens should not be banned from using VPNs. However, anyone given access to a VPN should some scrutiny before being granted access to the network. China is a major source of hacking, especially corporate networks. Companies have a right to determine who is allowed to access their VPNs and under what circumstances.