The Study Of The Local Government Financial Difficulties On Land Finance Contraction

Land finance refers to the activity and the relationship between the distribution of benefits that the local government use land ownership and management rights to carry out. It is an inherent feature of China’s economic mode. At present, the land finance has constituted more than half of local government revenue. Because of the various internal and external conditions restraining factors, the land finance is becoming contracting. And then it will make local government finance in difficulties which has depended on the land finance for a long time. The first part of the thesis mainly introduces the concept of land finance, land fiscal contraction and financial difficulties. The second part of the thesis analyses the performance and reasons of the land fiscal contraction, The thesis analyses the land fiscal contraction performance from three perspectives,these are the change of the land transfer income growth rate which is the main component of land finance,the change of the land transfer revenues accounted for the proportion of local fiscal revenue and the change of the land transfer area. This thesis analyzes the reason of land fiscal contraction from four aspects, mainly including the limited land resources, the more and more serious hazards caused by the land finance, The constraints of the external system, the real estate remain depressed. This paper analyzes the financial difficulties in three aspects, namely the pressure of fiscal revenue increased, the pressure of huge debt and the big public spending pressures. The fourth part discusses the countermeasures to land finance contraction. The main ideas are to build reasonable financial system that make the duties and responsibilities of the local government conform with owners of property, to strengthen the management of land revenue, to promote the reform of property tax, to reduce the construction of fiscal expenditure, to expand the financing channels by issue local government bonds, to strengthen the control of the debt risk, and to reduce unreasonable administrative expenses, in order to realize the successful transformation of land finance.