| Innovation is the core engine of China’s transformation of development mode,which has inserted "wings" for China’s economy to take off and occupies a pivotal position in China’s economic development.At present,China is accelerating the construction of an innovative country,and various innovation-oriented policies have emerged,the incentive effect of additional deduction of R&D expenses,as one of them,has always been an important issues in academic circles.In recent years,the preferential strength of the additional deduction policy has been enhanced,the scope of application has been gradually expanded,and the application procedure has been simplified,so that enterprises can apply to enjoy the policy to obtain a certain amount of pre-tax deduction,reduce the tax burden,increase the available internal funds,reduce the cost of research and development,and thus stimulate enterprises to increase their R&D investment and promote innovation output.However,in the process of policy implementation,due to the professional and commercial confidentiality of R&D projects and the difficulties in defining R&D costs,enterprises may manipulate R&D in order to be labeled as "hightech",reduce tax burden to reach the threshold of R&D ratio,and obtain tax incentives for additional deduction,which is difficult for the government and relevant departments to find out,thus may lead to the R&D efficiency not being improved simultaneously with the R&D investment,which is not conducive to the improvement of enterprises’ independent innovation capability.In addition,the " support seeking " of enterprises leads to the flow of government resources to "pseudo-innovation" enterprises with unnecessary R&D,reducing the efficiency of resource allocation,but also lead to the tax distortion,contrary to the original purpose of the policy.Based on the above analysis,focus on the latest adjustment of China’s R&D expense deduction ratio from 50% to 75% in 2018,this paper examines whether the significant increase of R&D expense deduction ratio will stimulate the "support seeking" behavior of Chinese enterprises using R&D manipulation for tax incentives,and obtains supportive conclusions,taking the A-share listed companies in Shanghai and Shenzhen from 2016 to2020 as research object.Drawing on the binary margin perspective used by relevant scholars in their firm-level studies,this paper uses firms that consistently apply for the additional deduction policy during the sample period as the treatment group,and firms that meet the application requirements but do not apply for it as the control group,and uses the PSM-DID model to verify from the perspective of the intensive margin that an increase in the tax incentives for additional deduction in 2018 triggers more serious upward R&D manipulation,showing "support-seeking" behavior towards the policy.The increase of enterprises’ actual tax preferential degree and the relaxation of tax supervision for enterprise applications due to the adjustment of the additional deduction policy mainly induce enterprises’ R&D manipulation.At the same time,after further considering the direction of R&D manipulation,it is found that for the enterprises with upward manipulation(positive abnormal R&D expenditure)even before the policy adjustment,the R&D upward manipulation behavior of them is more significant after the deduction ratio raise;In addition,during the research process,it was found that some enterprises were attracted by the increase of pre-tax deduction ratio and started to claim for this tax incentive.Based on this,this paper also explored whether these first claimants enjoying the 75% deduction would also show higher abnormal R&D expenditures compared with those not enjoying it from the perspective of extensive margin,and also obtained supportive conclusions.The contributions and innovations of this paper may be the following:(1)This paper dynamically tracks the recent adjustment of the policy and provides the latest evidence on the effect of the additional deduction policy.(2)This paper focuses on the differences in the degree of R&D manipulation of continuously enjoying firms before and after experiencing policy adjustments,providing a test of the effect of the policy from strong to strong.(3)Based on the research design,this paper identifies not only the effect of increasing the deduction ratio for R&D expenses from 50% to 75% on the R&D manipulation of persistent claimants(intensive margin),but also explores the effect of the adjustment of the percentage of additional deduction to 75% on the R&D manipulation of these first claimants(extensive margin)from the perspective of intensive margin and extended margin. |
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