Research On Income And Distribution Between Central And Local Governments Mainly Supported By Transfer Payment

In 1994,China began to adopt the "tax-sharing system".The central government's right to collect money directly led to the change of central and local income sharing.However,China has not substantially adjusted the power and responsibility of the central and local governments.Local governments are too short of income to shoulder their due responsibilities,so they begin to seek all kinds of non-tax income.The rapid growth of non-tax income has led to the increase of China's macro-tax burden year by year.By 2017,China's macro tax burden has reached 40%,which is higher than that of the United States in the same period and higher than the average level of developed economies.Excessive macro tax burden has seriously hindered China's economic growth and transformation and upgrading.Under the background of reducing the macro tax burden,how to readjust the income share of the central and local governments has become an important issue at present.Firstly,this paper combs the relevant literature of transfer payment,macro tax burden and fiscal decentralization,and then clarifies the research object,research caliber and research basis of this paper;Secondly,this paper uses the panel data of 2001-2017 in the main provinces of transfer payment to prove that increasing the proportion of local income in the central and local income sharing can promote local economic growth;Using factor analysis and cluster analysis,the main provinces of transfer payment are divided into three categories,and according to the characteristics of three different income structures,on the premise of sustainable restraint of macro-tax burden,the income adjustment schemes of the three types of provinces are emphatically analyzed.The results show that different types of transfer payments have different emphasis on income adjustment in the main provinces.The first type needs to focus on reducing the central tax and changing the proportion of the central tax.The second type should focus on reducing government funds.The third type should focus on adjusting the total and proportion of the shared tax,while significantly reducing non-tax revenue.Finally,based on the above research,this paper proposes that China should be active in transfering central financial power,enriching local government revenue sources,transfering part of local power to the central government,in order to promote the matching of financial power and power,and promote the smooth transition of our economy.The possible innovations of this paper are as follows: firstly,the issue of central and local income sharing is groundbreakingly placed in the framework of macro-tax burden constrained by sustainable development to ensure that the adjustment of the scheme can promote economic growth and economic transformation at the same time;secondly,this paper uses quantitative analysis of central and local income sharing at the provincial level,which has not been dealt with by predecessors.