A Comparative Research On The Fiscal System Reform Model Of Governing The County Directly By The Province

Fiscal system reform of "Governing the County Directly by the Province" means to turn the fiscal management relationship of province-city-county to province-city and province-county. The fiscal management of counties will turn from the model of province-city then city-county to the model of county controlled directly by provinces. From1994, our "Tax Sharing System (TSS)" is always focusing on the unification of duties and fiscal powers. However, because the levels of government are too burdensome, and the transformation of function is hysteresis, the fiscal relationship between governments is complex, governments’function is fuzzy, and duties and fiscal powers are not at balance. And the nature of "Governing the County Directly by the Province" is to downsize government hierarchy and further more to unify the duties and fiscal powers of local governments. In this context, this proposed program is an important measure to solve these issues. The fiscal system reform has been widespread concerned since its introduction, and the central government has turned it from the previous pilot reforms into final stages of implementation following the sprint in "Adviees On Promoting the Fiscal System Reform of Governing the County Directly by the Province " from Ministry Finance in2009.The theoretical basis of "Governing the County Directly by the Province" includes the theory of fiscal decentralization and the theory of flat structure. On the other hand, the appearance of disadvantages in "Governing the County by the City" and advantages in "Governing the County Directly by the Province" has provided the necessary realistic basis for further fiscal reform. And different characteristics, different measures, different application ranges and different results obtained in "Zhejiang model" and "Hainan model" have provided further necessary facts for the fiscal reform of "Governing the County Directly by the Province"Although there has been a lot of practical experience, and many Chinese scholars also have a lot of analysis and forecasting in the concrete implementation of the reform of "Governing the County Directly by the Province" in every province, the research on the classification of reform and the reason of this classification are not enough, and many scholars stop their research on how to continue this reform in a particular province. This paper seize the loophole, every province should choose their own model of reform based on their own economic development and geographical environment, and then classify those reform models to three categories which are "expand the rights of the county","withdrawn of county to build city" and devolving powers appropriately.However, only a model summary is not enough, the fiscal system reform of "Governing the County Directly by the Province" is a far-reaching program, and implicated in a number of policy adjustments, we can’t succeed in a short time and need to go through repeated demonstrations and experiments."Governing the County Directly by the Province" in our county is still in the initial stage, a lot of problems need to be solved. The key to success of reform, in addition to scientific and rational reform programs and proper time of the implementation, supporting measures in related fields are also important affecting factors. So the end in this paper analyzes three necessary supporting measures to ensure that the fiscal system reform of "Governing the County Directly by the Province" will progressing smoothly which are rationalizing the relationship of government entities at all levels, improving the tax system and the transfer payment system.