China isn't capitalist at all. Even things like buying land are typically timed leases owned by the government, and you see behavior like the Jack Ma incident where he made a perceived insult to the central bank and was "punished". Tied into labor programs and social credit, you see patterns that wouldn't ever fly in capitalism.
Communism doesn't mean everyone gets free groceries and doesn't have to work. The CCP, for all of their faults, seriously puts a lot of time and thought into the elements of communism and how the Chinese communism compares and evolves on it as a longterm form of government. Just because someone on the internet mistakes utopianism for communism doesn't mean Mao's party isn't communist.
It's quite Capitalist. Government ownership simply means that government is the capitalist instead of it being some private Billionaire, or a collection of investors in a joint-stock company.
Communism _does_ mean - among other things - that "everyone gets free groceries", in the sense that they would not exchange money or another commodity for the groceries, but rather get them through wider collective/communal/regional/country-wide arrangements.
I don't know why this is a popular misconception. You may have ration points or communism bucks instead of dollars, but you still need a hard currency to allow interpersonal trade. You may have resources that aren't obtainable through currency (housing), but you need currency because you need to settle preference/availability/tradeoffs. You probably also even still have some taxes for consumption.
The price of all goods is not equivalent on a fundamental labor level and the preference for goods is not flat.