Agricultural Township Functions Change After The Abolition Of Agricultural Tax

With the Tax-for-Fee Reform implemented in China from 2006, this greatly aroused the enthusiasm of farmers to improve the productivity of food supplies, which not only protect the safety of our nation's food supply, reduced the economic gap of urban and rural development, but also play a vital role in constructing a harmonious society and finalizing the integration of urban-rural development. However, cancelling the Agriculture-Tax for Tax-for-Fee policy also created the adverse effects to the agro type township, especially to its public finance.Due to the weakness of its industries and the tertiary industries of the agro type town, local government's extra budgetary public income were mainly depend on the agriculture-tax, and it also have the eminent domain of this budget before the Tax-for-Fee reform policy. Cancelling the agriculture tax means those local township governments lose the self-controlled income, and merely rely on the upper departments fiscal funds. With the market-oriented economy developed and the tax-for-fee reform implemented, local government's key working turned into the supplying the public service. However, most agro type town's fiscal policy changed into "dining fiscal" for no tax income, which blocked the turning of local government. This paper, by using the comparative analysis and inductive research methodology, studied the local township government (Gaboriau town, Ansai county, Yanan city, Shaanxi province) fiscal conditions before and after the tax-for-fee reform, and then analyze the deep problems under this fiscal condition as well as suited proposition. The author finds that the local government's not perfect administration system, non-developed economic, over-burdened debt and the low quality staff were the main factors hampered the function transforming of local government and improving the level of public service. Based on the existing problems the author finds, this paper give some policy suggestions from such perspective include improving the administration system of "Xiang Cai Xian Guan", which is the new form of fiscal policy in local level, and reinforcing the local government staff, increasing the transfer payment to township government.