A Research On The Impact Of Tax Burden Of Manufacturing Enterprises On Its Total Factor Productivity In China

In recent years,the development of China's manufacturing industry has been slow,and the ratio of added value of manufacturing industry to GDP has been declining year after year since 2010.Under the background of the new normal state of the economy,as the role that carries the most innovative resources in country,the manufacturing sector will face greater challenges.To comprehensively promote the strategy of implementing a powerful manufacturing country,it is of utmost importance to increase the productivity of the manufacturing industry.In the supply-side structural reforms,reducing the cost of entity-based companies requires a reasonable reduction of corporate tax burden.Therefore,it is of practical significance to study the impact of the tax burden of manufacturing enterprises on its total factor productivity in China.First,this article elaborates on the concept of tax burden and total factor productivity and related theories,and introduces relevant empirical research results on tax burden and total factor productivity.Second,it analyzes theoretically how the tax burden of a company affects its total factor productivity.The sources of changes in total factor productivity are technological progress,scale efficiency,and pure technical efficiency.Changes in resource allocation will change these efficiencies.The tax burden of enterprises will change resource allocation by affecting investment yield,cash flow,production scale,and preferential investment.That is,the tax burden effect,so the changes in resource allocation under the tax burden effect make the total factor productivity of the company change.The impact of different taxes on total factor productivity and the impact of different factor-intensive enterprises on its total factor productivity are different.Again,this paper uses panel data of some manufacturing listed companies from 2008 to 2015 to examine the impact of corporate income tax and turnover tax on total factor productivity using a panel threshold model.Besides a full sample empirical test,empirical tests were performed on different factor-intensive sub-sample companies based on the same idea.The results show that:(1)the impact of corporate income tax on total factor productivity has thresholds,and the relationship between the two is similar to an inverted U-shape.With the gradual increase of the corporate income tax rate,its impact on total factor productivity is promoted first and then suppressed.The threshold tax rate of technology-intensive manufacturing companies is lower than that of labor-intensive manufacturing companies,whereas the income tax of capital-intensive manufacturing companies has no significant effect on total factor productivity.(2)The turnover tax burden of most manufacturing companies is not conducive to the growth of total factor productivity.There are great differences in the effect of turnover taxes on the total factor productivity between different factor-intensive manufacturing companies.Finally,based on the empirical results and the characteristics of manufacturing companies,this paper gives suggestions in terms of tax burden for improving the total factor productivity of Chinese manufacturing companies.