Study On The Relationship Between Taxation And Economic Growth Of Dongguan City

The relationship between taxation and economic growth has always been the focus ofgovernments and academia. As the main source of government revenue, tax revenuegrowth is undoubtedly important to the government macroeconomic regulation andcontrol and the operation of government agencies, and economic growth is the source oftax revenue, therefore, It is very important to straighten out the relationship between thetaxation and economic growth. Since the reform and opening up, Dongguan has madeconsiderable economic development, Dongguan has become the "world factory" andChinese manufacturing pronoun. The rapid development of economy leads to the greatdevelopment of Dongguan tax revenue. A lot of people attributed the development of theeconomy of Dongguan to the processing trade. As is the true, did the tax have contributionon the economy of Dongguan? If there is, it is inhibited or beneficial effects? This needsus to use the knowledge, combined with the actual situation in Dongguan to give areasonable explanation.In this paper, on the basis of absorbing the previous research results, using the relatedtheory of macroeconomics and taxation, starting from the analysis of tax revenue andGDP of Dongguan data from1978to2010, this paper uses the method such as theGranger correlation analysis of causality, cointegration analysis of econometric methodsstudy the relationship between Dongguan tax revenue and economic growth deeply. Wefound that economic growth is the source of the tax, economy and tax rate determinesrevenue. Tax indirectly affects economic growth mainly through investment andconsumption Tax growth leads to the investment growth; but the tax has little effect onconsumption, consumption stimulates economic growth stably. On this basis, we putforward relevant suggestions and comments.