Research On Constitutionalism In Tax State

Constitutionalism, also constitutional government, is not so much to be said a social ideal as to be said a social and political life, which, more specifically, is more like a legal philosophy and political activity that helps coordinate and handle the relationship between people and country.It requires that, in dealing with the government and civil relations, the government power must be restricted by the Constitution, laws and other social regulations so as to ensure and realize human rights. In each step of the renovation of the constitutional order, the restructuring of the financial system unquestionably stays in an important key position. Economically speaking, each nation can be called a fiscal state.The concept of Tax States is an important model of fiscal states. They are above all constitutional and legal states. From a financial stand-point alone, a Tax State is in fact a financial state model which, throughout the whole process of financial expenditure, is accompanied with the legal and democratic spirit. Moreover, the democracy mentioned here is a real democratic system rather than a mutated, deceptive or manipulated one.The fundamental spirit and principles in Constitutional States are generally abided by and carried out in Tax States, since the latter can be considered the same as the former in financial domain. And Tax States can only meet in accord with its essence through implementing the financial system represented in the basic spirit of Constitutional States.In general, the basic principles of Tax States include Fiscal Democracy, Guarantee System of the Taxpayers'Rights, Power of Financial Supervision and Restriction and Social Welfare, etc. Among these principles, Fiscal Democracy is the precondition, and Guarantee System of the Taxpayers'Rights is the core principle and the key value pursuit. The material foundation of Tax States first relies on income tax. The government sometimes earns revenue from issuing currency and national loans as well as charging. Because of the dominant position of state ownership economy according to our socialism system determined by the Constitution, there, in China, still exists a great amount of State-owned Assets except taxation income. In addition, together with other Non-taxable Income and extra-budgetary income, new requirements have been made for establishing a Tax State both in the sense of form and of matter, i.e. a constitutional government and a legal country in financial and taxation fields.Tax revenue is the main financial source in tax States. Fiscal revenue except it should be included in non-taxable income. Although the definition of non-taxable income is a subject of debate, it generally includes fees revenue and fines and confiscations. It is of essential significance to Constitution jurisprudence. Meanwhile in China with public ownership playing the dominant role, the state-owned assets should be studied as a core problem in the discussion of non-taxable income.Public Expenditure is the government's planned redistribution of the public funds according to its public service functions. It is characterized first of all by its publicity, which means that, in market economy system, all the government expenditure is to satisfy the needs of people, rather than for its own well-being. Out of prudence, classical economists grasp a conservative attitude on the financial functions of the government in fear of the abuse of its power. However, the theory of state intervention proposed by Keynes holds that the government should step in the market and the economy directly and energetically for macro adjustment and control, so as to achieve full employment. The means of macro-adjusting basically have the policy such as government revenue and expenditure, resulting in the expansion of government functions and the boost in expenditure, which further brings the abuse of administrative power and the growth of fiscal deficit.The direct method to cut the deficit is to raise taxes. However, the government's expansion of tax right can shrink people's tax right, which will be definitely resisted by them. In modern rule-of-law counties, citizen's consciousness of rights has been awakening and enhanced, and the cost of the expansion of tax right has increased, that's why policymakers have to take many roundabout methods as issuing public loans, creating inflation, etc in hopes of extracting more financial funds. These are in fact the root cause of the Crisis of Tax States.History shows that almost all the major social changes originate from the reform of fiscal system, or rather, from the serious financial crisis and pressures. With the development of politics in democratic nations, there often appears financial crisis, which then turns into economic crisis and finally ends up as constitutional crisis.The constitutional crisis modern tax states are facing include, the expansion and abuse of the power of levy, the excessive expansion of the Non-taxable income, ineffective constraint to bond issues, the abuse of issuing of currency, uncontrolled power of the central banks and the erosion of the financial capital and interest group to democracy. Among these, finance and currency, the dominant social power in modern society, play a vital important role in democratic politics, which become the biggest menace to people's property right, and which, if not controlled well, will become a leviathan devouring people's wealth.In our country, financial pressure is an important driving force to push political changes. Tax Distribution reform, carried out in 1994, influenced our financial system greatly. Tax Distribution System is the general system of dealing with the fiscal relations of Central government and Regional government in market economy country. The Tax Distribution reform in China could not rectify the malpractice effectively, but producing new inflicts between Central government and Regional government, which requires new informs. It is the very choice that Fiscal Federalism is available to resolve such problems. Federalism is a political philosophy relating to federation as well as Political Order. Fiscal Federalism is the reflection of theory of philosophy of politics in finance area; meanwhile it is the product of constitutionalism practice. The basic spirit of Fiscal Federalism requires a reasonable division of the rights to handle administrative and financial affairs between the central and local governments, and requires the Constitution to recognize and protect the local financial autonomy and gives them sufficient power to exercise Tax Legislative power.For now, because of the great impact of Chinese entity economy by global financial crisis in 2008, China has put forward a series of expansionary financial polices, namely, huge capital investment and tax deduction, large scales of borrowings and massive financial deficit, which, though extraordinary measures taken in a special time, are very close to the trap described by Keynes, and have set a financial warning wake-up call to Fiscal States. This is also an inevitable question in Fiscal States researches.