An Empirical Study On The Impact Of Income Tax Preference On Small And Micro Enterprise Performance

Micro-small enterprises are an essential part of the national economy.It plays an irreplaceable role in promoting economic growth,increasing employment,stimulating scientific and technological innovation and stabilizing taxation.In view of the disadvantages of micro-small enterprises in the development process,China has formulated a series of preferential tax policies to support the micro-small enterprises.However,which still needs to be studied and discussed is that whether the tax incentives can really promote the performance of micro-small enterprises and how much the performance of enterprises effectiveness has been improved.The related research has achieved some results,but there are still some problems in the relationship between tax incentives and micro-small enterprise performance.Therefore,this paper studies the impact of income tax incentives on the performance of micro-small enterprises,which not only provides a reference for formulating tax preferential policies,but also enriches the relevant theories of income tax relief and micro-small enterprise performance relations.This paper takes the micro-small enterprises in Yancheng City as the objective to study the influence of income tax incentives on micro-small enterprises performance.Firstly,through extensive literature research,theoretical analysis,expert interview,and micro-small enterprise income tax incentives situation analysis,this study puts forward six basic assumptions about the relationship between income tax incentives and the performance of micro-small enterprises,profitability,development ability,capital operation ability,debt paying ability and social benefit.And construct 17 financial and non-financial indicators system,such as net asset growth rate,quick ratio,and research model Secondly,through the factor analysis,we can get five comprehensive indexes of comprehensive performance,profitability,development ability,asset operation ability,solvency and social benefit.Finally,we consider the all kinds of comprehensive performance of micro-small enterprise as the dependent variable,the preferential income tax as independent variables,the scale of Small and micro businesses(i.e.total assets)and enterprise type as the control variable,and then use the principal factor analysis regression preferential income tax incentives amount and the comprehensive performance index,so as to obtain the regression model.Through the empirical analysis,we find that the income tax incentives plays an important role in the comprehensive performance,profitability,development ability,asset operation ability,debt paying ability and social benefit of micro-small enterprises.And this also proves that China's tax incentives can effectively improve the performance of small and micro enterprises.So as to provide the basis for the country to further develop relevant tax policies to promote the development of micro-small enterprises faster and more stable,in order to promote economic growh,improve employment rate,employment,technological innovation to contribute more power.