It's normal.

There are two main reasons I don't want AI to demand vassalisation 1)They would annex a player in 10 years which sounds like a somewhat terrible gameplay experience (the game doesn't even warn you that you are being annexed). If instead you are a tributary you can still have an interesting game tryign to rebel at a good moment. 2)Tributaries are much more useful. There is very small benefit from having vassals (navalcap bonus) which is greatly outweight by tributary resource bonuses.