Research On The Legal System Of Local Government Fiscal Restructuring In China

The legal system of local government fiscal restructuring is an indispensable system for dealing with local government debt risks,which plays an important role in helping local governments to restore their fiscal situation,ensuring the normal production and living order of local residents and safeguarding the realization of creditors’ demands,etc.At the end of 2016,the General Office of the State Council issued the Emergency Disposal Plan for Local Government Debt Risks(hereinafter referred to as "the Plan"),which formally establishes the local Government fiscal restructuring has become an ex-post dealing for local government debt risks,providing a new solution to the local debt problem which has been intensifying in recent years,marking the establishment of the local government fiscal restructuring legal system in China.However,the legal system of local government fiscal restructuring in China has been just started,and there are still many imperfections.In this thesis,we will discuss the legal system of local government fiscal restructuring from four aspects.In the first part,it outlines the basic connotation of the legal system of local government fiscal restructuring,describing the main measures as well as the purpose and role of the legal system,and introduces three main patterns of fiscal restructuring.The second part discusses the constitutional basis for the legalization of local government fiscal restructuring,specifying that local government fiscal restructuring should adhere to the priority of people’s livelihood protection from the perspective of the financial relationship between the government and citizens,and specifying that the premise of local government fiscal restructuring is the independence and autonomy of local finances from the perspective the financial relationship between of central and local government.In the second part,it discusses the constitutional basis for the legalization of local government fiscal restructuring,and discusses the constitutional logic in local government fiscal restructuring from the perspectives of the fiscal relationship between the government and citizens and the fiscal relationship between the central and local governments,and explains the constitutional fiscal principles that should be followed in local government fiscal restructuring.In the third part,it points out the main problems of the current legal system of fiscal restructuring in China: Firstly,the procedural regulation of local government fiscal restructuring are not perfect,which are mainly reflected in the lack of rules on the initiation and termination procedures of fiscal restructuring,the lack of procedural regulation on the drafting and approval of fiscal restructuring plans,and the lack of regulation on the implementation and supervision of fiscal restructuring.Secondly,the protection of the rights of the“right” subjects in the process of fiscal restructuring is inadequate.To be more specific,the protection of creditors and the fiscal rights of local residents is inadequate.Thirdly,the supporting system for fiscal restructuring is not adequate.The principle of "no bailout by the central government" is difficult to be realized because of the lack of fiscal independence of local governments and the fact that a fiscal system that matches expenditure responsibilities with enough fiscal resources of local governments has not been established,as well as the fact that the legal system of financial transfer payment is still imperfect.In the fourth part,we propose measures to solve the problems that mentioned in the third part,which mainly include: improving the procedural regulations for fiscal restructuring,providing normative guidelines for the smooth implementation of fiscal restructuring;strengthening the protection of "rights" in the process of fiscal restructuring,practically protecting the interests of creditors and the fiscal rights of local residents,and balancing the relationship between local governments,creditors and local residents.It should strengthen the protection of "rights" in the process of fiscal restructuring,effectively protect the interests of creditors and the fiscal rights of local residents,and balance the relationship between local governments,creditors and local residents;improving the supporting systems for fiscal restructuring,establishing a system that matches expenditure responsibilities with enough fiscal resources,and improving the fiscal transfer payment legal system to ensure the ability of local governments to bear debt responsibilities independently.