Research On The Impact Of Tax Reduction On Labor Income Share Of Enterprises

Common prosperity is the essential requirement of socialism and an important feature of Chinese-style modernization.The tenth meeting of the Central Finance and Economics Committee proposed that promoting common prosperity for all people must be the focus of seeking happiness for the people.The labor income share is a good measure of the proportion of labor income in the national income,and it is the part shared by laborers in the achievements of economic development.It is of great significance to explore the influencing factors of labor income share to optimize the income distribution pattern and achieve the goal of common prosperity.Taxation is an indispensable policy tool for adjusting income distribution and promoting common prosperity.Tax reduction is an important measure to deepen supply-side structural reform,which inevitably participates in the process of distribution of production factors of enterprises.In order to explore the impact of tax reduction on the labor income share of enterprises and its mechanism,this paper studies it from the theoretical,current and empirical levels.Firstly,theoretical analysis.On the basis of defining the relevant concepts,the relevant theoretical basis is sorted out.Starting from the influencing factors of labor income share,this paper analyzes the mechanism of tax reduction affecting the labor income share of enterprises,and puts forward the channel mechanism.It believes that technological progress,financing constraints and investment growth are the important factors affecting the relationship between them.Secondly,the status analysis.Using statistical analysis method,this paper analyzes the current situation of enterprise tax reduction and labor distribution,and makes a typical fact analysis on the impact of tax reduction on enterprise labor income share.Thirdly,empirical analysis,the data of listed companies in Shanghai and Shenzhen A-share manufacturing industry from2009 to 2019 are taken as the research object to test the theoretical hypothesis of this paper.The details are as follows:(1)Using the two-way fixed-effect model test,it is found that tax reduction can effectively increase the labor income share of enterprises,and a series of robustness tests also support this result.(2)Due to different implementation targets,the tax reduction will have a differential impact on the labor income share of enterprises,and it will have a stronger effect on ordinary workers,eastern regions,small-scale,and non-state-owned enterprises.(3)Through the channel test,it is found that tax reduction effectively increases the share of labor income by stimulating technological progress of enterprises,easing financing constraints of enterprises,and promoting investment growth of enterprises.Finally,based on the conclusions of previous studies,reasonable policy suggestions are put forward in order to provide useful references for improving the share of enterprise labor income and optimizing the pattern of income distribution.To effectively promote common prosperity,we must focus on the development of enterprises that share labor,capital and other factors of production,focus on protecting labor income,strive to achieve simultaneous growth of labor remuneration and labor productivity,and increase the share of labor income in enterprises.The research on the relationship between tax reduction and labor income share helps us to understand the effect of tax on factor income distribution more comprehensively.