A Study On The Local Government Financing In The Process Of The Revenue-sharing Reform

In1994, China implemented the revenue-sharing reforms, which enable the Central Government to master the financial reform of China. It also develops the macro-controllability of the central government. Meanwhile, the central government’s financial resources have been concentrated by the reform. However, the revenue-sharing reform only regulates the financial rights for the central and local government, which is not clear enough to define the powers of local governments that are below the provincial level. With the implementation of the reform, powers of local government gradually expanded, while the expenditure of public goods is increasing. To solve the financial difficulties, which are due to the financial difficulties, of local government, financing activities of the local government is rapid development, formed financing platform and banks and government combined and land finance combination of local government financing mode. In this paper, analyzing the relationship between the tax system reform and local government financing, how to promote the public finance reform to improve local government financing activities is explored.Local government financing activities effectively alleviate the financial pressures of the local government, which can also provide financial sources for the local government to pay the public products and services spending. However, due to the lack of supervision of local government financing, in the running process of financing, there are some problems relating to the nonstandard construction of the financing platforms, not perfect mode of financing system and so on. These questions haunt the well development of the actives of local government financing, by studying these problems and propose appropriate countermeasures, are of important in theory and practice.Based on the theory of public goods, of fiscal decentralization and of institutional change, in this thesis, financing of local government-related concept is defined. The connotation and structure of local government are analyzed. Evolution of revenue-sharing reforms is reviewed. Meanwhile, the impact of tax reform on the local government finance and background of the financing of local government and the present of local government financing are analyzed and pointing out the problems and their reasons in the running of Local government financing activities.Combine theory with these problems, corresponding institutional design and specific measures to develop the local Government’s financing is proposed. Public finance system, the financial system and credit system, closed relating to local government finance, should be innovated to create a good system of environment. Advancing the reform of the local government tax distribution, providing local governments with financing environment, regulating the construction of local government financing, establishment of financing of control of local governments and strengthening the financing of local government management, improving the efficiency of financing of local government finance and other specific measures can be made to ensure the healthy development of the local government’s financing activities.