Research On The Problem Of Legal Regulation Of Local Government Debt

Relying on the government credit as a precondition,Local government debt means that the local government raises a loan as a debtor and undertakes legal obligations or agreed obligations to the creditor.Local government raising a loan is an unusual financing behavior under the special fiscal system,Both in terms of purpose and way, the rationality of its existence is considerable.With the bankruptcy of Detroit in 2013, the local government debt in our country,as an economic risk, has arouse extensive attention at home and abroad.Referring to the pros and cons of local government debt, we should analyze it from the perspective of the theory as well as practice.we cannot treat the different as the same.And need to analyze and discuss according to the actual situation.First of all, through raising a loan,the local government will directly or indirectly increase the fiscal revenue in a few years.But it also indirectly increase the fiscal expenditure in a few years,when the debts must finally be paid off.Secondly, the government raise money by issuing bonds, on the one hand it can improve the participation of private capital, on the other hand it also contributes to the bubble of the real estate industry in our country.Thirdly, while performing government duties,the local government provides public goods.At the same time,excessive debt makes the credibility of the local government declined,and harms the government’s image seriously when the debt is postponed to be paid off.In practice, raising a loan,even in illegal way,is universal phenomenon of local government.After long-term development and accumulation,the debt expand rapidly with massive and complex problems.In some areas,it has exceeded the normal load capacity of local finances.It is unable to clean up quickly and efficiently in a short time,resulting in the heavy burden of local finance and the debt crisis increasing in a high speed.Local government invests a lot of money in infrastructure projects,which has a long construction period.Income and costs are asymmetric in time-space.That costs incurred in current time,but the earnings should Share by generations in fair.It does not meet the benefit principle,if all of costs entirely borne by the taxpayer during the construction period.Thus,while effectively controlling risks,ensure reasonable access to normal government financing platform.Through the establishment of a sound regulatory legal system,deepening the tax law reform,innovating financing and management models and other ways to reduce debt risks and safeguard the interests of taxpayers.By Constructing our legal system the actual local debt in line,implement standardized management and governance of local government debt according to the law.In order to have a preliminary understanding for local government debts,this paper introduces the concept and some theoretical foundation of local government debt at first.Secondly,this paper selects two classical development model- Chongqing model and Shanghai model,and further analysis of their local government debt problems in the development.Then summarize the general characteristics of local government debt and raise the question of the development models.Thirdly,it is through carding current regulation of relevant laws of local government debt to finds out the legislative defects.At last,as the control mechanisms in USA and Japan run well with its mature regulatory system,here this paper will discuss the control measures suitable to our country’s actual situation,such as perfecting legal mechanism,deepening fiscal and tax law reform,regulating government financing platform,building the legal system security of paying off debts and improving other supporting measures.