| The tax sharing system reform introduced in 1994 initially defined the fiscal system between units of the central and provincial.However,it did not determine the relative unity of the fiscal system below the provincial level,but by the provinces according to their own condition.The consequence of fiscal system is "power down,fiscal up" between different fiscal levels,leading to fiscal difficulties of grassroots counties and townships,money supply imbalance in different regions and public service supply imbalance between town and country,which affecting the local economy and the sustainable development of society.At the same time,the implementation of the "City Administering County" in 1983 has played an important part in urban and rural co-management and the development of county led by city.However,with the county's economic development,the restrictive function of county's economy is also increasingly apparent.So it has become an inherent requirement of the market economy to cancel the system of "City Administering County".International experience shows that the common classification arrangement of tax sharing system is no more than three levels.However,China's fiscal system is divided into 5 levels:"center-province-city-county-township".The complex fiscal levels are incompatible with the tax sharing system which is put through radically.Whatever design can't put the basic requirement of "tax sharing leads to different government revenues by levels" into a five-level government structure.To find a long-term mechanism to solve the grassroots fiscal difficulties and carry on the local fiscal system innovation,academia and practical affairs have discussed how to simplify fiscal levels and proposed a fiscal system reform called "province administering counties".Up to now,most provinces have tested this fiscal system.According to the requirements of the ministry of finance,the fiscal system of province administering counties reform will be fully implemented in our country before the end of 2012.According to the different situations in every province,there are big differences in the specific reform measures,however the overall reform idea is the same,which is rationalizing and standardizing the fiscal distribution relationships below the provincial level,giving more development autonomy to county governments,increasing the fiscal support from provincial governments to municipal and county governments,directing municipal and county governments to improve their fiscal management levels,establishing a "province administering counties" fiscal system including fiscal settlement,revenue assessment,transfer payments,fund procurement,fiscal aid,work plans,etc.gradually.However,the system has played a positive effect in reality but also shown some problems,such as province,city and county are not clear of the responsibility and authority division,cities and counties are divided incompletely,the reforms of administrative divisions and systems are weak.Therefore,it's very important to study how to carry out the "province administering counties" system effectively and deeply.For this reason,this paper selects the "province administering counties" fiscal system as a topic.Firstly,it attempts to build a theoretical framework to enhance the theoretical level of the study.Secondly,it summarizes the motivation of this fiscal system's evolution and demonstrates the necessity of its reform.Thirdly,it summarizes several typical domestic patterns of the "province administering counties"fiscal system reform,compares their practical methods and explores the general experience.Then it assesses the overall effect of this system to provide empirical support.Finally,it proposes a path selection of the "province administering counties"fiscal system reform.This paper combines public product hierarchy theory,fiscal levels division theory,game theory and new institutional economics with the "province administering counties" fiscal system in theory,which can enrich the theory of the fiscal relationship between the local governments and give the theoretical base of promoting this fiscal system.In reality,the "province administering counties" fiscal system is an important initiative to accelerate institutional reform in local governments,expand the county's development of autonomy and improve the fiscal support capacity in county and township.A sound institutional arrangement is helpful to rationalizing the fiscal distribution relationships below the provincial level,promote city and county government to speed up the function change,provide better public services and promote comprehensive,balanced and sustainable economic and social development.So research the specific implementation plans and steps of the"province administering counties" fiscal system is instructive and referable for the policy makers to design the change blueprint of local finance system.The first chapter is introduction.This section describes the research background systematically,extends the necessity of the "province administering counties" fiscal system reform on the basis of such practical difficulties as county and township fiscal difficulties,imbalance between urban and rural public services,institutional constraints of "City Administering County" system.Foreign research literatures focus on the first two generations fiscal decentralization theories and provide theoretical support for China's local fiscal system reform.However,domestic literatures have become a multi-layer structure.They analyze the local fiscal system,fiscal level optimization and the "province administering counties" fiscal system.The analyses have both theoretical depth and the emphasis on the reform path.On this basis,we seek the paper's breakthrough points.Chapter 2 is the theoretical framework of the"province administering counties" fiscal system.This part describes the essence of the"province administering counties" fiscal system,which is how to provide varying levels of public goods by multiple levels of government.It involves the theory of public goods level,and needs to define the distribution of powers and fiscal authority of provincial governments,city and county governments and the township governments.Multilevel government fiscal system is derived from public goods hierarchy,which concerns the theory of government fiscal levels division.It needs to define the optimal scale of local government area,while the "province administering counties" finance system can simplify the fiscal levels and is helpful to flat the finance.In the framework of the hierarchical fiscal system,governments of all levels will conduct benefit gambling and fiscal competition to maximize their own interests,and we have to use the game theory to explain the game and behavior between provinces and cities,cities and counties under this finance system.The "province administering counties" fiscal system is a typical example of gradual shift from central government's supply system changes to the mode of middle-proliferation system changes.And they are all required the guidance of the theory of institution economics,such as factors affecting the supply system,factors affecting the system requirements and factors affecting the cost of institutional change.Chapter 3 is the evolution reason of the"province administering counties" fiscal system.This system is a big innovation of local fiscal system reform,which has a special evolution reason.This section can be summarized in four aspects.One is country and township grassroots fiscal difficulty,representing arrears of wages,fiscal deficit,will affect the normal operation of the grass-roots political authority.The second shows the unsmooth operation of fiscal system below the provincial level,representing dislocation of the division of public service responsibilities,unclear of intergovernmental tax division and non-standard transfer payments.The third one is the excess of government fiscal levels,whose consequences are the serious conflicts between the five-level government structure and the hierarchical fiscal system and fiscal distribution is not conducive to the county and township government grassroots finance.So the five-level government finance structure must be optimized into a three-level one.The fourth describes the restriction of the "city administering county" system,whose operation performances are the constraint of county's economic development,the increase of administrative costs and the imbalance between urban and rural development.Chapter 4 compares the practical experiences of the "province administering counties'' fiscal system reform in some typical provinces.This section summarizes out four typical provinces' modes to compare,based on the progress of province administering counties finance system reform test.The four modes are the Zhejiang province's fiscal system with innovative management pattern,the Hainan province's fiscal system with location advantage,the Hebei province's fiscal system based on overcoming counties and townships' fiscal difficulties and the Hubei province's fiscal system based on solving the problem of"small cattle pulling a big cart".On this basis,this paper sums up some useful experiences.Chapter 5 assesses the operation effect of "province administering counties'' fiscal system.This system has some positive impacts on the county's economy,local finance,local community development and local government construction.The problems occurred during the operation can be summarized as the"prefixion" of reform,the issue of fiscal system,the inconformity of government's action,the dissimilation of municipal city's behavior and some problems of local government management.Finally,it gives an analysis from the perspectives of history and empirical study.It combs the historical contains from the very beginning of the"province administering counties" fiscal system in Jiangxi,and chosse the personal administrative cost and GDP per person as various to do the empirical study.Chapter 6 gives an international camparison of different states which points out their advantages and shortages.It combs institutionalization and scientification as two decisive points of a stable and effective system of local public finance.Chap ter 7 is the path selection to optimize the "province administering counties" fiscal system reform.This section proposes the basic principles and classification of the optimization of the "province administering counties" fiscal system reform firstly,then proposes the specific optimized path selection of local fiscal institutions,including(1)divide the local governments' responsibility of public service below the provincial level,especially the basic public service responsibilities division of compulsory education,health care,social security and employment.(2)Structure the main tax of local governments at all levels.Provincial fiscal consists of sales tax mainly,others have value-added tax,corporate income tax,personal income tax,social security tax etc.In addition to structuring property taxes as its main tax,municipal and county governments should enhance the construction of the tax system which are benefit for local and regulate local non-tax revenue system.(3)Improve the transfer payment system,including merging the wide variety of general transfer payments and improving the special transfer payment.(4)Promote the administrative division reform,including adjusting administrative region on the provincial level,confirming the position and function of municipal city,establishing a government benefit-sharing and cost-sharing mechanism and regulating the "expanding and strengthening counties'power" system. |
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