Let's face it, they are #1 league now because the money. They know it. They can throw so ridiculous amounts of money, that they can sign almost any player from any league. Other than few top teams.
I think they want to keep it that way. Their league gets all the star players.
As Birdy said, imo, it is not that simple.
EPL wants money, but not as full retard as Uefa or Fifa who are willing to go to extremes in terms of payment and looking ridiculous.
England wants money, but they want to get rid of extreme cheating cases and oil money.
As Total Football said, it is slighlty hypocrite though.
Anyway, I am not following EPL that much, but whenever I watched it, I had a feeling that their FA, fans and refs hate City and want to help to "more normal/fair/historical" clubs like Liverpool, Man Utd, Arsenal.
City is always accused for everything, they are bad guys, refs are the most often against them.
There is a lot of shady money in EPL but they want to punish this extreme example of oil money.
A part of it is surely connected to politics, West vs East, eastern money and influences conquering the world and football in a somewhat shady way (Qatar as the latest example).
So EPL is setting the ground for different type of investors. And oil investors will have to play according to EPL rules.
I am sure that similar shaddy deals would have been found at Psg, but France has way bigger political, cultural and religious connections with oil countries so that type of money and influence is not as big deal as it is in Uk or as it would have been in let's say Usa.
So, imo, this is a mix of politics, current wars in the world, EPL's wish to move back towards their traditional clubs etc.
I never liked City due to Pep and unlimited amounts of money.
But this punishment (or refereeing in your favor), as always in high end sport as football, will be 80% sport and 20% interests, politics, propaganda, longterm financial-political goals etc.
EPL wants to stay rich and on top and they are willing to lose 10-20% of their income, if needed, to return a step back towards more traditional times and to get rid of newly emerged political and financial influences whom they dislike.
Big decisions and longterm directions of football/business are not made on the field but in the offices.