Study On The Optimal Resource Tax Rate Based On A CGE Analysis

Resources is the material basis of human society, and resource tax is a meansused by government to protect resources and regulate differential income. In recentyears, the resource tax reform has always been a hot issue in China, many scholarsmade comparatively detailed research about various aspects in the reform of resourcetaxes, and they had some instructive conclusions.Based on the analysis of each scholar’s research at home and abroad, we thinkresource tax rate should not only reflect the function of regulating differential income,it also should reflect the function of protecting the resources and protecting theenvironment. This article discussed the optimal tax rate of China through theestablishment of resource CGE model. Before modeling, this paper first establishedthe system of the CGE model, and the CGE model is divided into three modules,production, consumption and balancing module, the inhabitants, and main body ofgovernment and enterprise were organically combined, aiming to find a suitableresource tax rate for China’s economic development. In production module, weintroduced C-D function of production which is more suited to China’s specificsituation, and the resource with two elements such as labor, capital is introduced intothe production function, and it is meaningful to introduce the resource as a separateelement. The C-D function is also used to describe the consumer behavior to obtainconsumer’s utility function. Then we set up equations of equilibrium and found theequilibrium solution, and got each parameter of the equilibrium equations by allmeans. This article set1%as the macroeconomic acceptable scope of economic losses,so that we can obtain the scope of the tax rate range, through a series of operation, weobtained the optimal tax rate. Resource CGE model simulation results show that whenthe resource tax rate is set at20%, the lost of macroeconomic within1%which isacceptable. And the per capita resource consumption will be reduced greatly whenthis tax rate is set at20%, also the consumers total utility reaches maximum. So thispaper concludes that the optimal tax rate should be20%.