Research On The Impact Of The Policy Of Public-Welfare Donation Pre-tax Deduction On Corporate Charitable Giving

Charitable giving is an important means of the third distribution in China,which plays a vital role in adjusting income distribution,narrowing the gap between the rich and the poor and promoting the construction of a civilized society.In recent years,with the booming economic development and the improvement of national quality,the scale of China’s philanthropy has been expanding,the total amount of social donations are increasing every year.However,compared with other developed countries,China’s philanthropy is still not mature enough.From the history of the development of various countries,the development of a country’s philanthropy has a unique role in the economic and social development,so we need to further encourage and support the development of China’s philanthropy.In terms of the donation structure,the majority of charitable giving come from corporate donations,and the policy of public-welfare donation pre-tax deduction has always been the core means of the state to encourage corporate charitable giving.The policy of public-welfare donation pre-tax deduction has been developing continuously since it was put into practice.The proportion of pre-tax deduction increased from 3%to 12%,and the deduction allowed to carry forward within three years has effectively stimulated corporate charitable giving.In order to give full play to the advantages of tax policy and stimulate the enthusiasm of enterprises for charitable giving,there is still room for further optimization of the preferential policy of enterprise income tax deduction for charitable giving in China,a sound pre-tax deduction policy and a loose policy environment can give full play to the incentive effect of tax on corporate charitable giving.Therefore,it is of great significance to study and analyze the policy of public-welfare donation pre-tax deduction in China and put forward some suggestions to promote the development of charity.First of all,in the introduction part,the paper expounds the background and significance of this study,and summarizes the relevant literature of domestic and foreign scholars on the impact of tax policy on corporate charitable giving.Secondly,in the theoretical part of this paper,the theoretical basis of the impact of tax on charitable giving,we also analyze the income effect,substitution effect and price effect of the preferential policies on corporate charitable giving by means of budget line and indifference curve.In order to perfect the policy of public-welfare donation pre-tax deduction.this paper sorts out the evolution of the policy of tax deduction for public welfare donation,and summed up China’s public welfare donation before tax deduction policy to the main scope of indirect donations,deduction standards to limit deduction and public welfare organizations to identify the strict characteristics.Then,using 2118 companies listed on the a share market as the research object,the authors obtained their published data on charitable donations in 2018,and established a Log-linear model model,using OLS method to analyze the impact of the policy of public-welfare donation pre-tax deduction on corporate charitable giving in China.The results show that the amount of corporate charitable giving in China is affected by the policy of public-welfare donation pre-tax deduction,and the amount changes in the same direction as the corporate income tax rate The amount of corporate charitable donation and corporate net profit also change in the same direction,which is the income effect of charitable donation before tax,and the income elasticity range is(0.494,0.505).The policy of public-welfare donation pre-tax deduction has incentive effect,but there is still room for further optimization.And finally,according to the policy sorting,the main characteristics and the empirical research conclusion,this paper puts forward the problems of our country’s the policy of public-welfare donation pre-tax deduction,such as the low pre-tax deduction ratio,the imperfect carry-over system,the small number of public welfare charity organizations that meet the conditions of pre-tax deduction and so on.Based on the actual situation of our country,this paper puts forward some policy suggestions,such as optimizing the policy of tax deduction before tax and increasing the social organizations for public welfare.