The Shared Tax Model:Governments’ Strategy And Existing Choices

The tax system is an important part of the existing tax and public finance system in China, to improve the model of our shared tax is the necessary of optimizing the tax and public finance system; meanwhile, shared tax income composes the key part of China’s tax income, then to study the model of the shared tax can play an important part in ensuring government’s tax income, and can also provide adequate financial capability for revising economic structure and keeping the economy healthy. This paper analyzes the governments’behavior features under different model of the shared tax by setting up incoming function model of central and local government separately, and then it analyses the centralized or decentralized conditions to adapt to different kinds of the shared tax model. Next to examine the result in chapter three, it summarizes the choosing situation of shared tax model and its effect in different countries."$t the same time, the paper puts forward policy suggestions about optimizing shared tax system of our country, according to the reality of our country and the above conclusion. Specifically, this paper composes of the following six sections.Chapter one is an introduction of this paper. This chapter explains the significance of this paper, then it summarizes the existing study result of shared tax model throughout civil and foreign according to the searched literature. And then it explains the structure and the studying method of this paper. At last, it sets out the innovation points and the shortcomings of this paper.Chapter two is the shared tax and its model. This chapter brings up the definition of shared tax, and then explains the effect of shared tax system. Secondly, this chapter introduces the usual models of the shared tax. That is, proportional shared model, base shared model, tax rate shared model, additional shared model and the mixed model. Finally, this chapter tries to find out the distinguishing features among these kinds of shared tax model.Chapter three is the behavior analysis of the government about different shared tax model. This chapter sets up tax incoming function model of central and local government separately, and it analyzes the governments’behavior features under different model of the shared tax according to the functions, we can also examine whether the behavior of the local government consistent with the strategy of the central government, and then we can examine the necessity to control local government strictly, that is to say, which one is more appropriate, centralized or decentralized conditions. We can conclude that, it relies on the development diflferentiation of the civil regions. If it chooses the proportional shared model, especially when the development differentiation of the civil regions is great, the central government can take measures to keep the local government from complying central policy to control the local government more strictly; when the development differentiation of the civil regions is not great, the local government takes actions the same with central government, however, decentralized conditions can give more freedom to local government, then it can take measures suitable to the reality of the region. If we choose the additional shared model, the local government takes actions the same with central government, whatever, the development differentiation of the civil regions is great or not.Chapter four is the statistics description and analysis of the other countries about shared tax model. It studies the experience and effect of other countries to provide proof to the upper conclusion and to draw lessons for us. Firstly, this chapter chooses six developed countries and seven developing countries (district) as study samples, then it studies and analyzes these samples to examine the conclusion of the third chapter.Chapter five is suggestions for China. In this chapter, it mainly confers the present situation of China, and then it proposes policy suggestions for china. At first, it analyzes the situation of shared tax system in China, then it concludes that China is a developing centralized country from studying the present situation of China, and we can also get such a point that the development differentiation of the civil regions is great in China. At last, it proposes policy suggestions for china, specifically to say, it includes such points:to reduce the development differentiation of the civil regions by taking advantage of the proportional shared model if the central government can be more powerful than the local government; to give appropriate administrative power to the local government by changing into additional shared model; to adjust the governments’behavior by dividing the duty and the financial ability among the governments; to keep the policy stable and so on.Chapter six is a summary of this paper. It is a summary of this paper in chief, to summarize the contents and conclusion of this paper.This paper makes use of game theory, and it changes the suppositions, parameters and the analysis points and so on, it also makes a part of the variables as function, and it extends the analysis points of this game theory; it proposes policy suggestions for china by studying the behavior feature of central and local government; it makes use of knowledge on statistics, to get experience lessons about other countries in the world and to examine the conclusion in chapter three. Because of the lack of data, the function in this paper can be refined in some details, and it also can be examined using other methods like empirical ways. These points need to be completed in the future.