Research On The Influence Effect And Transmission Mechanism Of Tax Policy On Economic Growth In China

As an important means for the government to carry out macro-control,tax policy plays an important role in China's economic development.Targeted tax policy tools can effectively balance the speed and quality of economic growth.The report of the 19 th National Congress of the Communist Party of China points out that "China's economy has changed from a stage of highspeed growth to a stage of high-quality development,and it is in a critical period of transforming the mode of development,optimizing the economic structure,and transforming the driving force of growth",and it is necessary to "deepen the reform of the tax system,and improve the local tax system".In 2019 and 2020,the Central Economic Work Conference has successively proposed to implement large-scale tax reduction,structural tax reduction and other positive fiscal revenue policies.It can be seen that promoting the reform of the tax system and optimizing the current tax structure are the inevitable choices to promote China's economic growth in the new era.At this stage,under the international environment of COVID-19's global economic recession,China's economy is facing both internal and external pressures of the sharp decline in external exports and the urgent need to adjust the internal structure.Reasonable and effective tax regulation is particularly important for promoting China's high-quality economic growth under the current economic situation.It is inevitable to continue to implement and improve the large-scale tax reduction and structural tax reduction policies.In view of this,it is of great significance to explore the influence effect and transmission mechanism of tax policy on economic growth in China.Through combing the domestic and foreign research status and related theoretical foundations,this paper empirically tests the dynamic effect and asymmetric effect of China's tax policy on economic growth,and explores the transmission mechanism of China's tax policy on economic growth from the supply side and demand side.Firstly,based on the theoretical analysis of the mechanism of tax policy on economic growth,this paper uses the time-varying cointegration model to examine the dynamic cointegration relationship between tax policy and economic growth,and uses the quantile Granger causality test method to test the causal relationship between tax policy and economic growth.Then we build a factor-augmented vector autoregressive model with time-varying coefficients and stochastic volatility(SV-TVP-FAVAR)to investigate the dynamic impact of macro tax burden and tax structure on economic growth.The results show that: there is a significant time-varying cointegration relationship and long-term negative equilibrium relationship between China's tax policy and economic growth,and there is no two-way Granger causality between the two,which is only reflected in the fact that tax policy is the Granger cause of economic growth.From the perspective of total amount,the increase of macro tax burden has a significant negative inhibitory effect on economic growth.From the perspective of structure,the increase of commodity tax mainly has an inhibitory effect on economic growth,and increasing income tax can significantly promote economic growth,but increasing property tax has a negative inhibitory effect on economic growth.Secondly,from a short-term perspective,this paper explores the asymmetric effect of tax policy on economic growth under different economic cycles based on Bayesian smooth transition vector autoregressive(ST-BVAR)model.Then,from a long-term perspective,it tests the long-term asymmetric effect of tax policy on economic growth by using a nonlinear autoregressive distribution lag(NARDL)model.The results show that: from a short-term perspective,in the period of economic recession,tax policy has a weak positive impact on economic growth,consumption level and investment level,and in the period of economic expansion,tax policy has a negative impact on economic growth,consumption level and investment level.From a long-term perspective,there is a significant long-term equilibrium relationship and asymmetric effect between China's tax policy and economic growth.The positive pulling effect of the negative tax fluctuation on economic growth is weaker than the restraining effect brought by its positive fluctuation.Thirdly,based on the theoretical analysis of the factor driving mechanism of tax structure affecting economic growth,this paper uses the time-varying coefficient vector autoregressive model with latent threshold variables(LT-TVP-VAR)to investigate the dynamic impact of tax structure on the supply of capital,labor,technology and other factors in the period of economic crisis,economic recovery and new normal,attempts to clarify the internal dynamic mechanism of tax structure to promote China's economic growth,so as to explore a reasonable tax structure to promote China's economic growth in different periods.The results show that: in the period of economic crisis,economic recovery and economic new normal,tax structure has a significant positive effect on the level of physical capital,human capital and labor force,and a significant negative effect on technological progress.In addition to the level of labor,the time-varying effects of tax structure on the supply of the other three factors are stronger in the period of economic recovery and the new normal,and weaker in the period of economic crisis,while the effect of tax structure on the level of labor is stronger in the three periods.In terms of the duration of response,except for the level of labor,tax structure has short-term effect on the supply of the other three factors,and the long-term effect does not exist,but has significant effect on the level of labor in both the short-term and longterm.Finally,based on the theory of tax economic effect,this paper analyzes the demand transmission channel of tax policy affecting economic growth,and adopts a time-varying coefficient structured vector autoregressive model with stochastic volatility under the Metropolis-Hastings(MH)sampling rule(SV-MH-TVP-SVAR),and empirically analyzes the time-varying impact of macro tax burden and tax structure on consumption and investment,and then explores the contribution of tax policy impact on consumption and investment changes based on the timevarying variance decomposition idea.The results show that: macro tax burden has a negative impact on consumption,commodity tax and income tax have a negative impact on consumption,while property tax has a positive impact on consumption.Macro tax burden has a negative impact on investment,commodity tax has a positive impact on investment,and income tax and property tax have a negative impact on investment.The time-varying variance decomposition shows that the contribution of tax policy to the change of consumption and investment in different periods is significantly heterogeneous.This paper makes a comprehensive and systematic analysis of the economic growth effect and transmission mechanism of China's tax policy from different dimensions and perspectives.It can be found that China's tax policy has a significant time-varying and asymmetric impact on economic growth.In different periods and different external economic environment,the effects of tax policy on the supply of capital,labor and technological progress factors,consumption and investment demand have obvious differences.Therefore,the two-round regulation tax policy of total driving and structural optimization is more conducive to promoting China's high-quality economic growth.Adjusting the tax structure in a timely manner according to different economic goals,focusing on the supply of different factors and the domestic demand of the economy in different periods,giving full play to the regulatory role of structural tax reduction policies on economic growth is of great significance to promoting high-quality economic growth in China.