Study Of The Relationship Of Financial Power And The Responsibilities Between The Central And Local Governments

As the financial contract system existed a series of problems, our country haveimplemented the tax reform system for almost20years since1994and has made someachievements in initial stage. But with the development of social economy, the financialsystem is becoming more and more unsuitable in the process of implementing, whichmade a series of problems between central and local fiscal and taxation, such as theunfair distribution of financial resources, intergovernmental unclear duties and boundary,too many intergovernmental fiscal levels, asymmetry of power and responsibilitybetween the central government and local government and financial difficulties in thelocal government, etc. Facing numerous difficulties between the central and local fiscalrelations, China launched a new round of tax reform and put forward the measure toimplement the structural tax cuts, while the business tax was paid by value-added tax,which is the one of the largest action of a new round of tax reform and also one of thelargest single tax changes among implementation structural tax reduction policy. Afterimplementation “business tax was paid by value-added tax”, local government revenuewas greatly reduced, which would make the “business tax paid by value-added tax as astarting point to reform the current tax distribution system to comprehensively optimizeof central and local fiscal relations in Chinas and realize that the central and localfinancial authority and powers to match.Under the above background, the author chose " Study of the relationship aboutpower and property rights between the central and local authorities” for my thesisresearch project. The thesis was written according to the order of "historical changes, the status quo analysis, foreign experience for reference, optimizing suggestions". First of all,the fiscal relationship between central and local government was brief summarized andcommented from vertical perspective. Second，the present situation and problems ofrelationship between central and local fiscal and taxation was stated by using the latestofficial statistics，and then we adopted the central and local fiscal relation in thedeveloped countries of Japan, the United States, France and BRIC countries of Russia,India as an example and reference from the analysis of the horizontal comparativeperspective, to draw lessons and experiences from the developed countries and the BRICcountries of optimizing problems in the relationship of power and property rights.Together with the above, we optimize China’s central and local fiscal relations on thebasis of the proposed on the basis of the constitution, in legal framework, and putforward a series of targeted suggestions to standardize the central and local governancescope, adjust tax division between the central government and local governmentreasonably, and standardize the transfer payment system and so on.