Analysis On Local Tax Competition In China

Since reform and open to the outside world, China’s market economy development, the administrative system reform, the work of the government on economic center to tilt, from fiscal decentralization implemented step by step to establish the tax-sharing system, the local governments have the intrinsic motivation for tax competition, meet the needs of tax competition conditions. But because of the imperfection of fiscal decentralization, local government by using legal means for tax competition measures is severely limited, while there is no complete legal necessary constraints on the tax competition behavior of local government, resulting in tax competition among local governments in China are not standardized. In this paper, through the analysis of the phenomena and causes of tax competition, trying to find out the effect of China’s local government tax competition between the healthy development of the factors, and puts forward some policy suggestions.In China, local governments have no legislative power of Taxation, it is difficult to directly use the tax legal means to compete, often through the lower taxes, subsidies and even sales taxes and other methods to reduce the actual tax burden in the region. But in the tax competition at the same time, a slowdown in the local economy in recent years, the local financial distress, increase the contradiction between tax and water conservation continuous sharp, in order to alleviate this contradiction, local governments use plenty of illegal tax competition, resulting in social public interest loss, increase the imbalance in regional the development of a large number of redundant construction, the formation of regional, affecting the efficiency of market regulation.To promote the healthy development of tax competition among local governments in our country, first of all to reduce local government involvement in the economy, give full play to the role of the market, the role of the government in their areas of expertise, the rest is left to the market to solve; at the same time to regulate the financial revenue and expenditure of local government, at the same time increase the local government the tax authority of the expenditure and revenue transparency; finally to further optimize the tax collection and management, reduce the cost of tax revenue, improve tax collection efficiency.This paper is divided into four parts:the first part is the introduction, introduces the research background, purpose and the definition of related concepts, and then reviewed the relevant research results at home and abroad; the second part analyzes the causes of tax competition among local governments, foundations, discusses the classification, tax competition and influence; the third part analyzes our country local government tax competition between process, influencing factors, discusses the specific means of tax competition among local governments in our country and the result; the fourth part puts forward the relevant policy recommendations of China’s local government tax competition between the healthy development of the.