The Influence Of Local Govemment Tax Competition On Regional Economic Growth In China

Since the reform of the tax sharing fiscal system in 1994,local government has become a relatively independent interest body.In order to compete for tax sources and increase the scale of fiscal revenue,local governments have conducted fierce tax competition.Moderate tax competition can accelerate the flow of resources between regions and fully improve the efficiency of the use of resources,but vicious tax competition will destroy the order of economic operation and cause adverse effects such as the repeated construction of resources and the deterioration of ecological environment.Under the background of the system in which GDP is the main criterion for performance evaluation,the purpose of tax competition among local government officials is mainly to achieve regional economic growth to gain power and income.This paper mainly discusses whether the tax competition behavior of local government really promotes the regional economic growth.The tax competition behavior of local government influences the regional economic development through the two paths of income and expenditure,which may be positively correlated or negatively correlated under the influence of both positive and negative effects.Starting from the level of provincial governments,this paper empirically examines the existence of tax competition of local governments and the relationship between tax competition of local governments and regional economic development.The empirical results show that there is indeed tax competition among provincial governments in China,and it is manifested as mutual imitation.In addition,in the current stage,on the whole,tax competition of local governments has a significant role in promoting regional economic growth.After further sample regression,it is found that the tax competition behavior of the eastern governments significantly promotes the economic development of the eastern regions,while the inter-governmental tax competition of the central and western regions inhibits the economic development of the regions.In order to standardize the tax competition behavior of local governments in China,give full play to the tax competition to promote economic growth,this paper further improve the financial system,improving performance evaluation system,standardize the order of tax competition,transformation of the mode of tax competition,adjust measures to local conditions to carry on the tax competition,multi-factor power boost regional economic development of six Angle put forward the corresponding countermeasures and Suggestions.