A Study On The Impact Of Tax Competition On Industrial Transfer

Along with the reform and opening up,China's 30 provinces(except Hong Kong,Macao and Taiwan and Tibet)also obtained the rapid development of the economy,but different provinces with location advantage handsome first developed,this to a certain extent,the east central and western regions in our country economic development level disparity increases gradually,in order to narrow regional economic development gap between 30 provinces,is urgent.Between different local governments in order to attract industry transfer to the region transfer,have corresponding fiscal measures: perfect the local tax system,reduce the enterprise's tax burden between local governments,through tax competition for labor,capital,production factors and the influence of production technology to attract industry transfer,thus promote the region economy development.Based on the panel data of 30 Chinese provinces in 2001-2014,first,the analysis of how tax competition works on industrial transfer;Secondly,the present situation of local government tax competition and industrial transfer in China is analyzed.Finally,using Eviews software test whether there is a tax competition between different local governments in our country,using the dynamic panel GMM model analysis of local government tax competition between the influence of industry transfer to our country.Using Eviews software,this paper finds that there is a tax competition between local governments in China,and the competition for value-added tax and corporate income tax is all around.By using dynamic panel GMM analysis found that the VAT tax and industrial transfer has a negative relationship,the government can reduce the VAT to prevent enterprises abroad,at the same time reduce the VAT can attract industries transfer to the region;Enterprise income tax with industrial transfer has a negative relationship,through to lower corporate tax rates encourage enterprises to invest in the region and the production,thus promoting the region economic development.At the same time in order to make use of tax competition tool competition between local governments more reasonably,reduce the regional disparity between economic development level,avoid the phenomenon of vicious competition between local governments,this article from the reform and improve the range around the tax system,puts forward reasonable Suggestions,enables the local government to built around local taxes,thus forming a benign system of tax competition to attract industries transferring to this region.