Research On The Influencing Factors And Formation Paths Of Tax Decentralization

In 1994,China implemented the financial system of tax distribution.After more than ten years of reformation,China has gradually established a tax decentralization management system,which not only increased the central government's fiscal revenue,but also improved its macro-control ability.Obviously,this reform was more inclined to strengthen centralization.As time goes on,the market economic system in China is maturing and the trend of world economic integration is growing.Some scholars proposed that increasing the degree of tax decentralization appropriately should be considered in the fiscal policy design.It means that the financial system should gradually move from centralization to appropriate decentralization.The Third Plenary Session of the 19th CPC Central Committee adopted The Decision of the Central Committee of the Communist Party of China on Deepening the Reform of the Party and State Institutions and formally proposed that "Strengthen and optimize the government's fiscal functions,and further rationalize the relationship between the unified tax system and the hierarchical finance"in February 28,2018."Establish fiscal relationship between the central and local governments with clear powers and responsibilities,financial coordination and regional balance"also fully emphasized the importance of handling the fiscal relationship between the central and local governments,which was put forward in the report of the 19th National Congress.The issue of tax distribution is crucial,but this issue has not been effectively resolved.The research on the influencing factors is not comprehensive.Previous studies often consider each factor as an independent variable,focus on its individual role and pay little attention to the interaction.In fact,increasing the degree of tax decentralization as a policy goal is not universal.The degree in countries around the world is not absolutely increased,which have diversity and complexity.Hence,this paper attempts to find out the influencing factors of the degree of tax decentralization and explore how they work together.By analyzing the formation paths of tax decentralization,we can provide theoretical foundation for the reform of the fiscal system in China.Firstly,this paper introduces the indicators which measure the degree of tax decentralization based on related theories.And this paper carries through literature reviews at home and abroad.Secondly,this paper defines the concept of tax rights and elaborates the meaning of tax decentralization.And it carries on the theoretical analysis of the influencing factors from four aspects including politics,economy,rule of law and society.Thirdly,this paper introduces the method of fuzzy-set qualitative comparison analysis(fsQCA),selects the reliable data and sets the appropriate condition variables and result variables.And it also calibrated the value of the variables.Moreover,this part carries out empirical analysis which includes but not limited to the truth table,necessary conditions analysis and conditional combinations analysis.And it finally concludes the conclusions and makes international comparisons about the influencing factors and formation paths of the tax decentralization of three countries including the United States,Switzerland and France.Finally,this part analyzes the status quo of China's tax decentralization and then summarizes the conclusions based on the previous theoretical and empirical research.At the same time,it puts forward reasonable suggestions about deepening fiscal system reformation and forming effective tax decentralization system in China from the perspective of tax sharing system.This paper constructs a model based on configuration ideas through literature analysis and uses fsQCA to conduct in-depth research.The study found that tax decentralization is the result of different forms of the form of state structure,government size,the level of democracy and social participation,the level of economic development,the level of rule of law and population size.Among them,the high level of rule of law is a necessary condition for the high degree of tax decentralization and high democratic degree is close to the necessary condition.Compared with the level of rule of law,the level of democracy and social participation,the level of economic development and government size,the influence of the form of state structure and population size is relatively weak.And the variables of the form of state structure and government size usually appear in the combination of "single state*big government"and"multiple state*small government",both of which can lead to the high degree of tax decentralization.Finally,because China is a unitary state with large government,this paper puts forward the following suggestions for the fiscal system reformation:develop the economy greatly and lay a material foundation for tax decentralization;improve the level of tax legal system continuously and optimize the runtime environment of tax decentralization;improve the level of democracy in China and create the main body and environment for tax decentralization.