Research On The Impact Of Provincial Intergovernmental Tax Competition On Regional Economic Development

Since time immemorial,where there is a market,there is competition.And local governments have competed in various ways and means in the conduct of their various taxation tasks.After the reform and opening up,especially after the implementation of the tax sharing system in 1994,local governments have been given considerable autonomy and discretion with the deepening of market-oriented reforms.In order to secure tax sources,increase fiscal revenue,promote regional economic development and achieve performance appraisal,local governments are actively seeking tax resources.Moderate tax competition can promote the effective circulation of regional resources and the efficient use of resources,but excessive and vicious tax competition will disrupt the normal operation of the market,leading to the duplication of resources and the deterioration of the ecological environment.In this context,in order to prevent excessive or vicious tax competition among provincial governments,encourage moderate and effective tax competition,and promote economic development by regulating tax competition,this thesis mainly focuses on tax competition as the research object,analyses the impact of tax competition among local governments through the analysis of tax competition among local governments,and discusses how to regulate tax competition among local governments The first chapter of the thesis is the introduction,which focuses on the development of tax competition among local governments.The first chapter of the thesis is the introduction,which mainly introduces the research background,significance,literature review,research methodology and research content as well as innovation and shortcomings;the second chapter is the basic theory of this thesis,which mainly analyses the impact of tax competition among provincial governments on economic growth from a theoretical perspective.The third chapter is an analysis of the current situation of tax competition and economic development.Firstly,it summarises and summarises the history of local tax competition,secondly,it uses data to derive the level of national economic development and the current situation of tax competition,and describes it by region,and finally,it puts forward two relevant hypotheses through the above data analysis:hypothesis one is that tax competition will promote the economic development of each region,and hypothesis two is that there is regional heterogeneity in the promotion effect of tax competition on economic development.The second hypothesis is that there is regional heterogeneity in the role of tax competition in promoting economic development.The fourth chapter section is the empirical analysis,using a panel threshold regression model,and an empirical analysis of 30 provinces and cities from 2000 to 2020,and a comparison of the effects of tax competition between different regions.The empirical results show that at the current stage,from an overall perspective,local tax competition has an important impact on regional economic development.The heterogeneity analysis shows that tax competition among local governments in the east,west and northeast of China has a significant driving effect on regional economic growth,but tax competition in the central region has no significant effect on economic development.Through the above theoretical analysis and empirical tests,the fifth section of this thesis summarises the findings of this research as well as makes corresponding recommendations.Firstly,three conclusions are drawn,namely,the driving effect of tax competition on economic development;the existence of regional heterogeneity in tax competition on economic development;and the fact that tax competition mainly manifests itself in tax rate competition and aggregation rent competition.Secondly,in order to make tax competition better promote economic development and better regulate local governments’ tax competition,corresponding countermeasures are proposed from five perspectives respectively.The first aspect is to improve China’s tax sharing system and improve our fiscal legislation,so that the state’s fiscal revenue and expenditure behaviour are subject to legal constraints and to a certain extent eliminate unreasonable local tax competition;the second aspect is to promote regional development with the combined efforts of multiple factors,coordinate regional development and achieve mutual benefits and win-win situation between regions,local tax authorities should carry out top-level design and overall planning,and in the tax competition should pay attention to inter-regional coordination and co-ordination in order to ensure the relative fairness of tax burden among different regions and promote inter-regional development and sharing.Thirdly,a multi-level tax incentive system should be reformed and improved.It should be designed in a multi-level and multi-layered manner,and different tax incentives should be implemented for different situations,and the same tax incentives should be set in different regions respectively,so as to effectively improve the use of fiscal funds and ensure that they play a guiding role to a certain extent and optimise the use of fiscal resources.The fourth is to improve the performance appraisal system for officials,diversify the indicators for the promotion appraisal of government staff,reduce the absolute proportion of GDP and increase government welfare,such as investment in areas such as education,education,health and pensions.Fifthly,market competition should be regulated.Different tax policy objectives and strengths should be differentiated,and appropriate adjustments should be made to some unregulated areas in order to prevent vicious competition among local governments.