The Research Of Tax Relationship Between The Central Government And The Provincial Government

The tax reform in 1994 established a new fundamental financial administration system in our country.Impacted by the political and economic system reform,the tax reform is not perfect,facing the difficulty of government authority layer down layer and financial power layer upon layer,which caused local financial resources shortage,local taxation structure weakness,mismatching between local finance power and government authority,and tax revenue not adapted to fiscal spending.In this context,the 18th session of the National People's Congress reinforces the reform of fiscal system and puts forward to establishing a modern financial system,in regarding to improve financial power to match with government authority and ameliorate the financial relationship between governments.This article talks about the tax relationship between the governments which is the core content of the financial relationship between governments.Profoundly understanding the tax relationship between the governments will help to grasp the financial relationship between governments,is of great significance to the whole financial system reforming.At present,the academic circles mainly focus on the study of the financial relationship in three aspects:division of government authority,division of financial power and transfer payment system.As the basic premise,financial relationship between the governments is not the same to tax relationship.The author believes that tax relationship between the governments is the organization and allocation of tax revenue which is based on the division of the government authority,based on the taxation structure and the division of taxation power between the governments,aiming at the efficient allocation of public funds,performing the government function well and playing a good role of tax.The division of the government authority is the basic premise of the tax relationship between the governments,the taxation structure is the base,the allocation of taxation power is the main line,the reconstruction and balance of the central tax revenue system and local tax revenue system is the core and key.In the environment of socialist market economy,tax revenue become the main body of fiscal revenue,taxation power becomes the core of financial power.For the central and local government,tax revenue is the guarantee of fiscal revenue.In order to guarantee financial power matching with the government authority,the first is to guarantee taxation power matching with the government authority basely and tax revenue matching with fiscal expenditure basely,which is the aim of this paper.The construction of two levels of tax revenue system between the central government and local government is the key to the tax relationship between the central and local government.Study the balance of the tax revenue relationship between the central and local government is the basic foothold in this paper.To determine the balance reasonably,taxation power must be matched with the government authority,tax revenue must be matched with fiscal expenditure,which can solve the question of financial relationship from the structure level.Although based on the rational allocation of tax revenue between the central government and the local government at the provincial level,the tax revenue relationship between the central government and local government at the provincial level is the core and key,not as the only goal,we should also consider the effective role of the tax.Perfecting the tax relationship between the central and local government,as it were,the fundamental purpose is to promote the better performance of the central and local government's functions and play a role of tax better.According to the basic principles of finance,the basic role of tax has two:the first is the organization of revenue,the second is to control the economy.Recent major changes in the field of tax is mainly about two events,The first is the structural tax cuts,the second is from business tax to added-value tax,the second one actually can also be incorporated into the category of the first one,which is a key step in the structural tax cuts.In accordance with the overall requirements of the structural tax cuts,we should decrease the overall tax burden instead of increasing tax burden,reduce the tax burden level within the taxation structure.From the paper structure,this paper argues that the reduce of tax burden should not only be beneficial to the whole economic structure adjustment and industrial structure adjustment of the economic construction,but also be conducive to the proportion adjustment of direct taxation and indirect taxation in taxation structure.From the tax relationship between the central and local government at the provincial level,reasonable division of the tax relationship regards the match of taxation power and government authority as the main target,at the same time considers that the improvement of the taxation structure should be conducive to the adjustment of direct taxation and indirect taxation,be advantageous to the adjustment of economic structure and industrial structure,be conducive to play a role of tax to adjust economy well.Government authority,taxation structure,allocation of taxation power are three important factors to limit the tax relationship between the governments.The three factors determine tax revenue system of the central and local government,which is the core of the tax relationship between the central and local government at the provincial level.This article describes the current division of government authority and expenditure responsibility in our country,the present situation of the taxation structure,the division of taxation power,and the tax revenue system.This article also analyzes the existing problems:As the central issue,the first one is the tax revenue system,that is,the central financial resources are relatively abundant,local financial resources are relatively insufficiency,and the local financial resources are high degree of dependence on the central government's transfer payment;The second one is the problem of shared tax including too much share of taxes,multifarious sharing way,and high proportion of shared tax;The third one is the problem of local tax including lack of local main taxes,local taxation structure needed to be perfected and so on.According to the research ideas of this paper,the problem of tax revenue system is the core issue of the tax relationship between central and provincial government,which is the problem of tax revenue ownership substantially.In the tax relationship between the central and provincial government,tax revenue system can be divided into central tax revenue system and local tax revenue system,to improve the tax relationship between central and local government,that is to reconstruct the central and local tax revenue system essentially.It is of great significance for the study of the tax relationship between the central and provincial government to divide the taxes into central taxes,local taxes and shared taxes.But how to define the boundaries of the three taxes is controversial.The construction of local taxation structure is the key to the construction of the two-level tax revenue systems.At present,the connotation of the local taxation structure and how to improve it are controversial issues in the theoretical circles.This paper regards the allocation of taxation power as the main line and defines the concept of local tax and local taxation system,then puts forward some suggestions on the improvement of local taxation structure from two aspects of taxation power and taxation structure.On this basis,this paper puts forward the general idea to perfect the tax relationship between the governments:Firstly,one is to maintain the central government's control,the other is to activate local government;Secondly,combining optimized taxation structure with rational allocation of tax revenue:on the one hand to rationally divide central taxes,local taxes,and shared taxes,on the other hand to gradually raise the proportion of direct tax,optimizing the taxation structure reasonably.This paper argues that perfecting the tax relationship between the central and local government at the provincial level is a systematic project which can't be accomplished overnight.Rebuilding the two-level tax revenue system in the comprehensive management of the division of government authority,the optimization of taxation structure and the allocation of taxation power.Matching taxation power with government authority basically,coordinating taxation structure with allocation of taxation power basically,adapting tax revenue system with expenditure responsibility basically,in order to ensure the unity of the central government's control and the vitality of the local government and play a good role of tax organizing income and adjusting economy.Only the tax revenue are divided reasonably in the central and provincial government,in order to make government authority and expenditure responsibility between governments at all levels to exercise reasonably,which decide that all levels of government can play their due role in the national governance,and this role is the result of the positive interaction of government authority,taxation structure and allocation of taxation power.From the point of the government level,the intergovernmental tax relationship should include the horizontal relationship and vertical relationship.Horizontal relationship is the tax relationship between the governments which is under the jurisdiction of the same local government or not under the jurisdiction of the same local government,including the same level of local governments and different level of local governments.Vertical relationship is the tax relationship between the upper and lower government,including the tax relationship between the central government and the provincial government,the tax relationship between the upper local government and the lower local government.In this paper,we study the tax relationship with allocation of taxation power as main line.The division of taxation power includes horizontal and vertical division,horizontal division is the division of legislative,administrative and judicial organs,the division of vertical taxation power is mainly divided into the central and local governmental taxation power.Among them,the tax relationship between the central and provincial government affects and restricts the normal operation of the tax relationship among governments at all levels,provides important reference for improving the tax relationship between local governments at all levels.Therefore,the scope of this paper is mainly about the tax relationship between the central government and the provincial government.The main content of this paper is divided into 6 chapters:The first chapter introduces the background and significance of the tax relationship between the central and provincial government,summarizes the domestic and foreign literature and research about fiscal decentralization,division of government authority,taxation structure,division of taxation power and local taxation structure,defines the connotation of tax relationship between the central and provincial government,makes clear the scope and the research of the study,makes clear the research methods and the innovation and deficiency.The second chapter makes a general theoretical analysis of the tax relationship between governments,points out that the division of government authority and expenditure responsibility is the premise of tax relationship between governments,the taxation structure is the base,the division of taxation power is the main line,the reconstruction of the central and local tax revenue system is the core,perfecting the local tax system is the key.The third chapter focuses on the analysis of the effect of intergovernmental tax relations.Firstly,with the use of tax deadweight loss principle,Ralph curve and Ramsay's law of Economics,analysis on the tax relationship between the government is carried out,expounding the pros and cons of tax decentralization;Secondly,it describes the significance of tax decentralization for national governance,giving local government tax legislation and the implementation of tax sharing system,in order to stimulate the vitality of local government and improve the national governance capacity;Thirdly,with the tax revenue and expenditure responsibility GDP growth data from 1998 to 2015 as the foundation,this paper focuses on the analysis of the relationship between fiscal decentralization and economic development,proves that the tax relationship influence on economic development;Fourthly,the analysis of the relationship between the government and the relationship between tax employment growth is carried out.Due to Chinese Decentralization under the framework of local competition and promotion pressure,tax decentralization has a significant influence on the negative employment growth area;Fifthly,the relationship between intergovernmental tax relations and fair distribution is analyzed.Because the local government has more disposable financial resources,more funds are turned to investment expenditure,to a certain extent,it intensifies the income distribution.The fourth chapter describes the status quo ante of the tax relationship between the central and provincial government in the following 4 aspects:government authority and the expenditure responsibility,the taxation system,the division of the taxation power and the two-level tax revenue systems.The current situation of government authority and expenditure responsibility is lack of legal basis,the division of government authority and expenditure responsibility layer down,the local financial resources are not enough;The current situation of tax structure is lack of the main tax of local tax,the proportion of direct tax needs to be improved;The current situation of the allocation of taxation power is lack of top-level design,and the overlapping of tax collection and management right and tax revenue attribution right is serious;The current situation of the tax revenue system is that the local tax system needs to be improved.The fifth chapter focuses on the analysis of the problems existing in the tax relationship between the central government and the provincial government.First,it analyzes the main factors that restrict the tax relationship between the central government and the local government,that is,the government function,the taxation structure and the allocation of taxation power.Then this article puts forward a core issue and the two basic problems of tax relationship between the central and provincial government.A core issue is the imbalance between the central and provincial government,two basic problems are sharing tax issue and local tax issue.The sixth chapter designs the overall framework of the tax relationship between the central and provincial government in China in the future,including the fundamental purpose,the overall idea,the main principles and the overall layout.From the four aspects:redefining of the government functions,improving the taxation structure,the rational allocation of taxation power and the reconstruction of two tax revenue system,the article puts forward suggestions for perfecting tax relationship between the central and provincial local government.