Yuxi City, "urban County" Financial Management System

Since the tax reformation in 1994 when the Tax Assignment System was implemented, the Yuxi government, adopting the City-Governing-County fiscal management system, has made the comparatively developed prefecture level city Yuxi City a economic center, and exercised its financial leadership according to the intergovernmental distribution of revenue and expenditure of its governed regions, striving to boost their economies through the thriving of Yuxi City.Yuxi, in recent years, with the policy of reform and opening-up and scientific and technological progress as driving force, has been holding on to such a strategic development which is based on balanced eco-system,characterized by tobacco economy, features its industrial sector and relys on its agricultural sector. Under the guidance of"three excellent and a special", it emphasizes on restructuring economy and bringing farmers tangible benefits as well as accelerating new industrialization and efforattracting more investments while supporting governed precincts. In consequence, it has achieved a huge social and economic progress. However, within the present fiscal management system, financial difficulties at county level has already emerged, which exhibit as a increasing deficit,a shortage of dispensable money, a low degree of self-sufficiency and so on.These problems have to some extent negatively influenced its development. This article, by positive analysis of fiscal management of Yuxi under the City-Governing-County System since the implementation of the Tax Assignment System, studies the financial difficulty of its counties and correspondent advices and resolutions. The article is arranged in seven parts.The introduction, as the first part, introduces the background and significance of the research, then reviews briefly the research results on fiscal decentralization and causes of financial difficulties by scholars at home and abroad, and puts forward the aim, methods, content structure of the research. The second part is research on concerning theories of this article, including primarily those of local finance, division of local revenue and expenditure and local fiscal decentralization. The third part is a short summary of changes that have taken place in the fiscal management system of Yuxi. The fourth part is positive analysis of the operational state of the City-Governing-County System since the Tax Assignment System. The fifth part, based on the outcome of standard analysis and econometric modeling, further analyses the problems that currently exist in the county finance from such aspects as the fiscal magagement system, the population supported by the county finance, the disposable income of the county and the sources of its revenue. In the sixth part, suitable proposals for the solution of local problems are provided, in hope of perfecting the City-Governing-County System of Yuxi, and thus contributing to the harmonious development of finances at municipal and county levels. A conclusion and future prospects are stated in the seventh part.