The Influence Of Income Tax Incentives And Fiscal Subsidies On Total Factor Productivity Of Enterprises

General Secretary Xi Jinping pointed out in the report of the 20 th Party Congress that he would accelerate the construction of a modernized economic system,focus on improving total factor productivity,and enhance the resilience and security of the industrial supply chain."As a new concept first introduced at the 19 th Party Congress,the 20 th National Congress Report added the word"strive" to it,repeatedly emphasizing its importance to China’s economic development.Thus,the requirement of total factor productivity in the report of the National Congress of the Party highlights the importance of this indicator for China to start a new journey of building a modern socialist country.The key to high-quality development lies in sustained economic growth.China’s previous economic growth model was through the investment of a large amount of capital,labor and land and other factors,but as far as it seems,the economic growth brought by these factors is not sustainable,and even leads to excess capacity,zombie enterprises and many other problems,which is why China has changed the core path of economic development from "high-speed This is one of the reasons why China has changed the core path of economic development from "high speed" to "high quality development".Therefore,China wants to start a sustainable economic growth momentum in the new normal,so that economic growth to achieve a quality speed,it is more critical that we should improve labor productivity through technological innovation and management optimization.So,in a sense,total factor productivity can also be said to be the productivity generated by technological innovation in a sense.Innovation is the reconfiguration of production factors and environment,while the innovation mechanism and capability of enterprises are the core of competition.However,due to the inherent defects of the market mechanism,the increase of total factor productivity cannot be accomplished automatically in the market mechanism,and the government must reasonably use policy tools to make necessary interventions and corrections to market failures.As the core policy tools controllable by the government,the effective use of income tax preferences and financial subsidies is crucial to resolve market failures,optimize enterprise resource allocation,promote enterprises to carry out technological innovation,enhance enterprise total factor productivity,and promote high-quality development in China.Based on the background of the appeal,this paper finally chooses the Western Development Strategy as the target policy to study,not only because the Western Development Strategy includes a number of income tax incentives and financial subsidies,but also because western enterprises play an indispensable role in the integrated development of the western region and the whole country.This paper will take the second round of western development from 2011 to2020 as the time point,and adopt the policy boundary line to select the data of western enterprises and non-western enterprises to maximize the net effect of income tax preferences and fiscal subsidies on enterprises.First,we briefly explain the research background and purpose of this paper,and analyze the joint analysis of high-quality development,fiscal policy and total factor productivity of enterprises;second,we review the literature on income tax preferences,fiscal subsidies and total factor productivity of enterprises in China,and analyze the income tax preferences and fiscal subsidies involved in China’s western development from both conceptual definition and theoretical interpretation,and introduce the influence mechanism of fiscal policy on enterprise Then,the DEA-malaquist index method is applied to analyze the total factor productivity of enterprises on both sides of the policy boundary line,and it is found that the total factor productivity of western enterprises is slightly lower than that of non-western enterprises;Based on this,a benchmark model is used to regress fiscal policy and enterprise total factor productivity.It is found that income tax incentives have a significant promotion effect on enterprise total factor productivity,while fiscal subsidies have a "mixed effect" on enterprise total factor productivity.