A Study On Financial Subsidies And Preferential Tax Policies For China's Wind Power Industry

In order to solve the problems of resource depletion and environmental pollution brought about by fossil energy,various governments including China have introduced various industrial policies to support renewable wind power industry development.Financial subsidies and tax incentives are the two most common used policies.This paper attempts to study the effectiveness of China's wind power industry related policies,and provide suggestions for the government to formulate policies for wind energy and other renewable energy industries in the future,by comparing the incentive effects of financial subsidies and preferential tax policies for wind power industry.This paper firstly studies the status of wind energy resources and industrial development in China,and summarizes the problems in the development of wind power industry in China.Afterwards,we conducted a combing study of existing domestic wind power financial subsidies and tax incentives,summed up a series of problems,and proposed suggestions according to foreign experiences.Based on the previous theoretical research,this paper selected 29 wind power companies' operating data from 2012 to 2016 and established a panel data model to empirically compare the effects of wind power fiscal and taxation policies.The results of the study indicate that:(1)tax incentives help improve the profitability of wind power companies,and fiscal subsidies have no significant effect;(2)The larger the scale of wind power companies,the stronger the profitability,and the level of financial leverage is not significant for profitability.Impact;(3)Financial subsidies and tax incentives are not conducive to improving corporate operating efficiency,and financial subsidies may even result in a decline in corporate efficiency.Through research and analysis,this paper puts forward the following policy recommendations:(1)Improve the use of tax incentives and improve the use of mechanisms;(2)Adopt different policy approaches for different policy objectives.Tax incentives can be used to increase the profitability of enterprises.To improve operational efficiency,it is necessary to rely on other means such as improving technology and management level;(3)Different policies and means are adopted in different stages of the same industry.The initial stage of industrial development focuses more on financial subsidies,and the industrialization stage focuses on preferential tax policies;(4)The central government should encourage local governments to actively support the development of wind power by shifting expenditures and returning valueadded tax;(5)Increase incentives for access to grid and use of wind power.