The Empirical Analysis On The Impact Of Turnover Tax On Residents’ Consumption Under The Sight Of Tax Shifting

Consumption as an indispensable part of people’s life, its importance is self-evident.The consumption level of a country or a region’s can directly reflect the level of economic development and the potential of development, and also can indirectly reflect the degree of residents’ happiness. After the economic crisis, the sharply decline of foreign demand, and excess capacity due to high investment, make the expansion of residents’ consumption demand a urgent matter never before. At the same time, in the modern economy condition, consumption and taxes are closely linked. As an important method of government macro-control, tax policy can have a significant impact on the residents’ consumption demand by changing the consumption ability, consumption desire, and consumption environment. Since the 1994 tax reform, turnover tax has become our country’s main tax, which is the main tax that consumer bear. So tax burden of turnover will directly affect the residents’ consumption level and consumption structure. In the new round of tax reform, which aim is tax cuts, how to improve the turnover tax system so as to stimulate domestic demand and boost the recovery of economy is a major challenge for the government of China. At the same time, the turnover tax is always easily shifted. Especially in China’s current tax system, the transference of turnover tax become more and more secluded and complex. So if we don’t understand clearly about the path and mechanism of tax shifting, we may violate the original intention of taxation regulation, and fail to reach the expected goal.Therefore, from the perspective of tax shifting to study the impact of turnover tax on residents’ consumption has a strong theoretical and practical significance.Firstly, this paper summarizes and reviews the domestic and foreign research from two aspects of the tax burden shift and the effect of tax on the consumption of residents.And then analyzes the impact of the transfer tax on the consumption of residents,mainly from two aspects of “income effect” and “substitution effect”. Analyze the law of tax burden shift mainly from the perspective of supply and demand elasticity and the characteristics of Commodity. Then, this paper analyzes the situation of consumption of residents in China, and reached the conclusion that the consumption of Chinese residents is insufficient. Then the reasons for the lack of consumption are analyzed.Then use the 630 residents consumption data selected from the statistical yearbook2003-2012, with the aid of EVIEWS software to get the consumption function of residents of different income levels, using the ELES model and the regression results calculate out the basic needs and price elasticity of demand for different goods of different people who has different level of income, and analyze the calculation results.Finally, based on the above analysis, make suggestions on how to perfect the turnover tax system and improve the level of residents’ consumption in China. Mainly from four aspects :first gradually reduce the proportion of turnover tax, optimize the structure of the tax system; second further promote to replace the business tax with a value-added tax, and constantly improve the VAT system; third reform consumption tax to help promote consumption upgrade; fourth tap the consumption potential of residents, and promote the consumption of hot spots.