Research On Optimizing The Tax System Structure To Promote Common Prosperity

The essence of socialism is to liberate the productive forces,develop them,eliminate exploitation,eliminate polarization,and ultimately achieve common prosperity.The essence,purpose and superiority of socialism with Chinese characteristics lie in common prosperity.The report of the 20 th National Congress of the Communist Party of China pointed out that one of the five characteristics of Chinese path to modernization is the modernization of common prosperity of all people,and realizing common prosperity is the meaning of realizing modernization.Since the founding of New China,especially since the reform and opening up,the Party and the country have always regarded improving the living standards of all people and promoting common prosperity as one of the important goals of governance.For decades,China’s economic development has made remarkable achievements,and people’s living standards have improved to a great extent.Especially since the 18 th National Congress of the Communist Party of China,the Party and the country have implemented the targeted poverty alleviation strategy,completed the first century goal on schedule,entered a new era of comprehensive well-off society,and greatly improved the level of common prosperity.However,it should also be noted that with the rapid development of the economy,the development imbalance between regions and the widening gap between rich and poor are gradually becoming apparent.Further improving the income distribution system and promoting high-quality development is an important part of comprehensively building a modern socialist power.Finance is the foundation and important pillar of national governance and an important measure to promote common prosperity.Among them,taxation,as an important means of national regulatory system,has broad and far-reaching significance in regulating income distribution,improving consumption environment,guiding technological innovation and green development,and transforming economic development mode.However,China’s current tax system structure,which is dominated by indirect tax,is unbalanced,and the polarization adjustment of residents’ income and property is insufficient.The fairness of income distribution needs to be strengthened.Reasonably adjusting the tax system structure can further promote economic development and fair income distribution,thus helping to promote common prosperity in high-quality development.On the basis of relevant theoretical analysis,this paper defines the concept of tax system structure,expands the tax system structure from three dimensions of tax system structure,tax category structure and main tax categories,expounds the scientific connotation of common prosperity,and constructs a comprehensive evaluation system of common prosperity from three aspects of development,sharing and sustainability.Based on the analysis of basic theories such as Marxism common prosperity theory and optimal tax theory,this paper expounds the mechanism of the tax system structure affecting common prosperity.Then it analyzes the current situation of China’s tax system structure by provinces and cities,and calculates the common prosperity index of 30 provinces in China from 2000 to 2021 using the entropy method on the basis of the above.According to the basic theory and current situation analysis,we can get the development status of China’s tax system structure and common prosperity,which paves the way for the following empirical analysis.In empirical analysis,the first step is to construct a model,select variables,and conduct descriptive statistics.To test the stationarity of the data,based on the results of ADF test and Kao test,the selected data in this article is stable.Then,it makes a benchmark regression analysis of common prosperity from three levels: tax system structure,tax category structure and main tax categories.In order to verify the robustness of the regression results,the explanatory variables are lagged for one period and the sample size is reduced.Finally,group regression was conducted to test the heterogeneity of the data based on the proportion of direct taxation in the eastern,central,and western regions of the region.According to the empirical results,the tax system structure has a significant impact on common prosperity.From the perspective of tax system structure,increasing the proportion of direct taxes and reducing the proportion of indirect tax are conducive to achieving common prosperity.From the perspective of tax structure,reducing turnover taxes and behavioral purpose taxes,and further increasing income taxes,property taxes and resource taxes are conducive to promoting common prosperity.From the perspective of major taxes,reducing the proportion of value-added taxes,promoting consumption tax reform,and further increasing the proportion of corporate income taxes and individual income taxes are conducive to promoting common prosperity.Provide feasible suggestions based on the research results.Specifically,it includes increasing the proportion of direct taxes and promoting fair income distribution;Reduce the proportion of indirect tax and realize the balance of tax system structure;Optimize the tax system and introduce new types of taxes in a timely manner;Improve the tax system and further implement structural tax reductions.