The Theory Of The Fiscal Transfer System And The Fiscal Transfer System Of Zhejiang

Intergovernmental fiscal transfer system, an important system and measure to keep the fiscal balance between central government and local governments, has been widely adopted by countries implementing tax-sharing system. Since the reform of tax-sharing system in 1994, fiscal transfer system has been gradually improved. However, some problems still exist. Therefore, starting from the basic theory of transfer system and based on the evolution of China's fiscal system, the paper explains China's current transfer system and analyzes its inherent shortcomings. The reform tendency of China's transfer system is put forward in the paper as well, which regards equity as its premise, equalizing public service as its target and taking into account the efficiency. Moreover, some practical measures on the reform of current transfer system are proposed.As an essential part of the entire transfer system, the establishment of transfer system under the provincial level is always an important issue for study. As a vital momentum for the rapid, sound and sustainable economic development of Zhejiang Province, the fiscal transfer system of Zhejiang Province has received a lot of attentions from more and more experts and scholars. After introducing the transfer system from central government to local governments, the paper analyzes special transfer system of Zhejiang province as its key point, such as "two guarantees, two connections" etc. Firstly, the background of transfer system of Zhejiang province is introduced, the possibilities of this system are analyzed by utilizing theories of "Rational Economic Man" as well as "Games", and the effects of carrying out this system are discussed. Secondly, in the light of relevant problems, five measures are put forward, including adjusting expenditure structure, establishing a new transfer system by factor analysis method, regulating special purpose grants and so on. Finally, on the basis of analyzing and summarizing the central and Zhejiang provincial fiscal transfer systems, a new mode of establishing a transfer system under the provincial level and some key factors are put forward.