Value-added Tax Transformation On The Impact Of Business Investment

The impact of taxation on business investment research belongs to the scope of taxefficiency. As business investment in the whole society is not only an important means of capitalaccumulation is also an important incentive for business growth, and State tax revenue is animportant tool for regulating the economy, the relationship between taxation and corporateinvestment in research is a good link the two together. So the research about the impact of taxeson corporate investment, whether from the theory and practice has a strong sense. This also mayexplain why this research has been a hot issue in the field of foreign public economics. In ourcountry on the impact of taxation on corporate investment in research is still in its infancy, littleexisting research. China from July 1, 2004 to promote value-added tax from the gradualtransformation of (production-based to consumption-based) provides a good opportunity to studythe impact of taxation on business investment. In view of this, we choose focus on this issue toenrich our research in this area, and study China's the actual effect of value-added taxtransformation on business investment.This article firstly learn the basic theoretical research results of the West to build aframework of tax and business investment research, and combine with our tax system gives therelationship between business investment and tax expression. Then we propose value-added taxtransformation on business investment have a positive impact hypothesis. And we use valueaddedtax transformation of enterprises in Northeast China and other regional non-transition,multi-year enterprise to enterprise level panel data tests. Finally, we analyze the measurementresults.The main conclusions of this paper: Value-added tax of effects business investmententerprises by influencing the actual cost of investment, thereby. the actual cost of businessinvestment has been reduced and the actual reduction in cost of investment will spurred businessinvestment. Therefore, our value-added tax transformation on business investment has a positiveimpact. Empirical analysis shows that the estimated coefficient of business investment andadjustment costs is 0.3-0.7. If other cases don't changed, after VAT transformation, the price ofcapital goods dropped to 1/1.17. Based on rough estimates, a factor of value-added tax transformation and business investment is 0.1-0.2. Namely, the transformation of VAT has agreater role in promoting on business investment. Meanwhile, in the Study on the stability of thearticle we also find that Northeast China's preferential policies on income tax and corporateinvestment and no significant correlation.