| The Third Plenary Session of the 18th CPC Central Committee pointed out that " public finance is the foundation and important pillar of national governance,and a scientific fiscal and tax system is the institutional guarantee for optimizing the allocation of resources,building a united market,promoting social equity,and realizing the long-term peace and stability of the country." Since the founding of new China,the income distribution relationship between the central and local governments has always been an important institutional factor affecting the effectiveness of national governance.In the case of major reform choices,the fiscal and tax systems can always become a breakthrough for reform,making outstanding contributions to the development of China’s socialist cause.After the reform of the tax sharing system in 1994,the income distribution relationship between the central and local governments had been basically rationalized.The local tax system has been gradually established,becoming an important part of the national fiscal and tax system,providing strong tax support for the local economic and social development.After the 18th National Congress of the CPC,socialism with Chinese characteristics has entered a new stage of comprehensively deepening reform.The overall goal of reform has changed from establishing a socialist market economy to improving and developing the socialist system of socialism with Chinese characteristics and promoting the modernization of national governance system and governance capacity.In the new era,the goal of the reform is no longer only focused on the economic field,but is committed to the comprehensive and coordinated development in all fields of politics,economy,society,culture and ecological civilization.Facing the new era,new tasks,new requirements,local tax should also be closely combined with the needs of national reform and development,and make greater contribution to national governance modernization.The reason why highlights the role of local tax on local government governance is not only that the local tax is an important source of local fiscal revenue,but also local tax has unique governance functions.Specifically,local tax is conducive to establish the communication link between local government and society,to stimulate the endogenous power of local government to improve governance,to improve the enthusiasm of society to participate in public governance activities,and to restrain the behavior of local government.However,there are still some unreasonable places in local tax,which restrict the governance functions of local tax,resulting in some governance problems.Therefore,it is necessary to further improve the local tax system.This is not only the basic content of the fiscal and tax systems reform in the new era,but also an important way to realize national governance modernization.This thesis studies the impact of local tax on local government governance.According to the new requirements of local tax reform and local government governance modernization,basing on multiple research perspective,various theories and empirical methods,this thesis trys to find the overall impact,mediator mechanism and spatial effect of local tax on local government governance,etc.The specific research content is as follows.First,based on public finance and state type theory,governance theory,fiscal decentralization theory,this thesis analyzes the significance and influence mechanism of local tax on local government governance.Its significance is that local tax is the foundation and important pillar of local government governance,and has unique governance attributes.Its influence mechanism is that local tax can affect local government governance from two levels of local government and social people.On the one hand,at the local government level,local tax can affect local government governance from five aspects: income security,responsibility mechanism,incentive mechanism,restraint mechanism and information transmission;on the other hand,at the society level,local tax can improve the motivation and capacity of society to participate in public governance activities through the participation mechanism and learning mechanism.Second,Using the method of historical analysis,this thesis examines the development process of local tax and local government governance in different historical stages since the founding of new China,in order to find out the historical logic of local tax affecting local government governance.It can be found that in different historical stages and historical backgrounds,tax is always the link between the government and the society.There are not only direct economic relations,but also indirect political and social relations.Local tax can create the necessary political,economic and social foundation for local government governance.The generation and change of local tax profoundly affect the interaction between the local government and the society,and then affect local government governance.Third,Using the qualitative analysis method,this thesis analyze the defects of the current local tax and the problems of local government governance.Firstly,the lack of local tax revenue leads to the weakening of local government governance ability,inadequate supply of non-economic public goods,excessive dependence on transfer payment income,arbitrary fees,fines and apportionment,excessive competition among local governments,land finance problem and local debt risk.Secondly,the unreasonable structure of local tax revenue leads to the lack of local financial autonomy,low fairness of tax burden,weak taxpayer awareness and the lack of important governance tools.Thirdly,the lack of local tax legislative power leads to the rights and interest of governments be not protected and the inability to use tax to govern according to local conditions.Fourth,By selecting subdivided evaluation indicators from multiple angles,this thesis establishes local government governance comprehensive assessment system in line with the reality,and analyzes comprehensive assessment index from multi-dimension,then objectively and truly describes the situation of local government governance,the existing problems and development trend,in order to better serve the local government governance modernization and provide data support for further empirical research.Fifth,this thesis empirically tests the overall impact of local taxes on local government governance.The main conclusions are as follows: Firstly,the relative scale of local tax has a significant positive affect on local government governance,and with the improvement of the local government governance level,the impact of local tax on local government governance is also increasing.Secondly,the impact of local taxes on different governance fields is different.Local tax has the greatest impact on social governance,followed by economic governance,cultural governance,political governance,and finally ecological governance.Thirdly,the impact of local tax on local government governance is different in different stages of economic development.When the level of economic development is low,the impact of local tax on local government governance is little.When the level of local economic development increases,the impact of local tax on local government governance will be increased.Fourth,the impact of local tax revenue structure on local government governance is different.Property tax and income tax have a significant positive impact on local government governance,and the impact of property tax is greater,while goods and services tax has an insignificant positive impact on local government governance.Direct tax has a significant positive impact on local government governance,while indirect tax has an insignificant positive impact on local government governance.Fifth,the impact of local tax on local government governance is unlike in different market development levels.When the development level of market economy is low,the impact of local tax on local government governance is relatively weak.When the development level of market economy is high,the impact of local tax on local government governance will be increased.Sixth,different types of government revenue have different impacts on local government governance.Although transfer payment income and non-tax income can bring a lot of revenue for local government,it is difficult to establish the connection between the government and society,unable to form an effective incentive and restraint mechanism for local government governance.On the contrary,these types of government revenue may also inhibit the improvement of local government governance,which is exactly the advantage of local tax.Sixth,this thesis empirically tests the mediator mechanism of local tax affecting local government governance.Main conclusions are as follows: firstly,local tax can increase the enthusiasm of the society to participate in public governance activities,promote the development of social organizations,enable local governments to have more sufficient financial revenue to support the development of social organizations,so that social organizations can participate in public governance activities more widely and deeply,then increasing local government governance level.Secondly,local taxes can effectively stimulate the responsibility sense of local governments.Local governments with more local tax revenue are more willing to use more financial funds to provide basic public services for local people.Thirdly,by comparing the the results of two mediator effects,the responsibility mechanism on the improvement of local government governance is greater than the participation mechanism.It shows that the mediator effect of local tax on local government governance mainly comes from internal self-motivation and restraint,rather than external participation and cooperation.Finally,the difference in revenue structure of local tax will cause different mediator effects.Both direct tax and indirect tax can promote social organizations to participate in public governance activities,but the participation effect of direct tax is more obvious.Direct tax can significantly affect the responsibility sense of local governments,while indirect tax can not significantly affect the responsibility sense of local governments.Seventh,this thesis empirically tests the spatial effect of local tax on local government governance.The main conclusions are as follows: Firstly,there is a positive spatial auto-correlation in local government governance,and the provinces with similar governance level have obvious feature of mutual gather.Most of the central and western provinces and the northeast provinces are under "low-low" clusters,while most of the eastern provinces are under "high-high" clusters.Secondly,based on the spatial weight matrix of neighboring relations,local tax has a positive spatial spillover effect on local government governance.Thirdly,by comparing main effect and spatial effect,direct effect and indirect effect,the spatial spillover effect of local tax on local government governance is higher than the main effect and the indirect effect is higher than the direct effect.It shows that the change of local tax in neighboring areas has more obvious impact on local government governance.Eighth,in view of the relevant problems mentioned in the above analysis and empirical test,the corresponding policy suggestions are put forward.Firstly,reasonably divide inter-governmental authority and expenditure responsibilities.Secondly,appropriately devolve tax power and strengthen legislative supervision.Thirdly,enrich and improve local tax categories.Fourth,increase the proportion of direct tax in tax revenue and the transparency of tax burden.Fifth,guide the tax competition behavior of local governments.Sixth,cultivate the tax rights awareness of the whole society.The innovation of this thesis is mainly reflected in the following three aspects: Firstly,the innovation of the research perspective.At present,there are still few research results focusing on the impact of local taxes on local government governance.This thesis focuses the research perspective on the level of local tax and local government,and make a systematic summary from the theoretical basis,historical process,development status and existing problems,so as to have a deep and comprehensive understanding of the relationship between the local tax and local government governance.Secondly,the innovation of research content.From the five aspects of politics,economy,society,culture and ecological civilization,this thesis reasonably selects relevant indicators,in order to build a comprehensive assessment system of the local government governance level,to fit the comprehensive indicators that can reflect the overall situation of local government governance level,and to cover the deficiency of insufficient descriptive power of a single index.Thirdly,the innovation of research methods.This thesis adopts the quantitative methods such as principal component analysis method,panel fixed effect model,mediation effect model and spatial effect model,and by using these innovative methods,it can provide a more solid empirical basis for the theoretical results. |
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