The Analysis And Research On The Tax Revenue And Economic Growth After The China's Tax System Reform

Since the 1994 tax system reform, China's tax revenue has increased at a high speed. Compared to 1994, the tax revenue in 2004 has nearly fourfold. While providing solid financial security to the stable development of national economy, the sharp leap of tax growth has also attracted economist's attention that whether this high speed is coordinated with economic growth. First this article analyzes the basic principle of the relation between tax revenue and economic growth at a theoretical point. By the tax multiplier it has proved that GDP changes reversely along with the tax revenue changes, namely GDP reduces with the increase of tax and increases with decrease of tax. Then set out from our domestic reality, it analyzes the characteristics of tax after the reform based on the data from 1994 to 2004. With the method of cross sectional analyses, it adopts the concept of the marginal tax rate to make empiristic analyses about China's provincial tax growth and economic growth since 1995 to 2004. Finally according to the research results, this article proposes the related policy suggestions to promote the coordinate development of tax and economy, reviews the characteristics of tax system reforms in foreign countries and prospects China's new-round tax system reform.