Study On Tax Incentives On Innovation In Industry Level Based On HLM Model

At the "Two sessions" in 2015,Premier Li Keqiang of the State Council put forward the slogan of "Mass entrepreneurship and innovation" in view of the problems of China's economic development.On May 30,2016,General Secretary Xi Jinping proposed at the National Science and Technology Innovation Conference that we should build a world's technological powerhouse.In February 2016,the "National Science and Engineering Indicators" released by the National Science Foundation showed that China has become the second largest R&D country in the world.China accounts for about 20%of the total global R&D expenditures calculated at purchasing power parity,second only to the United States(27%).In 2017,China's investment in science and technology continued to grow.Research and experimental development(R&D)expenditures and national public expenditure about science and technology continued to increase.In 2017,R&D expenditure was 1,760.61 billion yuan,there was an increase of 192.94 billion yuan over the previous year,an increase of 12.3%,and the growth rate was 1.7 percentage points higher than that of the previous year;R&D expenditure intensity(Compared with GDP)is 2.13%,which is a 0.02 percentage point increase over the previous year.The R&D expenditure was 436,000 yuan,an increase of 32,000 yuan over the previous year.Among them,corporate R&D expenditures reached 1,366.0 billion yuan,an increase of 12.5%over the previous year.However,due to the characteristics of corporate technology innovation,such as publicity,externality,and risk,there are market failures in the process of corporate technology innovation,which reduces the enthusiasm of technology innovation of firms.Therefore,the government needs to adopt policies to motivate firms to carry out scientific and technological innovation activities.Tax incentives are very important means of government regulation.However,the effect of tax policies on different industries may be different,and it is very important for us to clarify this difference in formulating differentiated tax policies and improving the effectiveness of policies.Based on the analysis of the basic principle of tax incentive for scientific and technological innovation,this paper further studies whether the incentive effects of tax policies on different industries are different,and provides a theoretical basis for the optimization of tax incentive policies for scientific and technological innovation.First of all,this paper systematically sorts out related researches from the perspectives of the principles,effectiveness and research methods of tax incentives for scientific and technological innovation,and forms a literature review.Secondly,this article defines the concept of scientific and technological innovation,and explores the factors that affect scientific and technological innovation.Based on this,it analyzes the mechanism of scientific and technological innovation investment,and systematically analyzes the necessity and role of tax incentive in scientific and technological innovation.It also highlights the impact of industry factors on tax incentives for technological innovation.Thirdly,this article summarizes R&D investment in China,and analyzes the tax incentives for encouraging scientific and technological innovation from the perspective of industry.Finally,based on the data of 2,103 listed firms in 26 industries in China in 2016,using the multilevel linear model,this paper analyzes the effectiveness of tax incentives on the corporate scientific and technological innovation,and analyzes the effect differences between different industries.Based on this,it puts forward optimization proposals for China's tax incentives for encouraging scientific and technological innovation.This article uses Hierarchical Linear Models(HLM)to study the effect of tax incentives on corporate R&D investment.It also focuses on analyzing the effect differences of policies in different industries.The HLM innovatively regards the coefficients of explanatory variables and control variables as two parts:fixed coefficient and random coefficient,which can distinguish between enterprise factors and industry factors in the process of tax incentives for enterprises'scientific and technological innovation R&D investment.Different industries have different characteristics.From the perspective of factor intensity of industries,corporate R&D intensity is higher in the technology-intensive industries than that in the resource-intensive and labor-intensive industries.From the perspective of economic growth of industries,corporate R&D intensity is higher in the high-speed economic growth industries than that in the low-speed economic growth industries.The study found that there is a positive relationship between tax incentives and corporate R&D investment,and there are obvious industry differences.Therefore,studying the effect of tax incentives on corporate R&D investment cannot ignore the differences between different industries.Therefore,we cannot ignore the differences in the industry when formulating tax incentives.Based on China's current policies,this article puts forward corresponding suggestions;scientifically formulate indicators for R&D investment intensity of different indutries,and comprehensively increase tax incentive policies for encouraging technological innovation,with a focus on increasing tax incentives for companies in technology-intensive industries and strategic emerging industries.We must also formulate policies to guide the transformation and upgrading of non-technical enterprises.