Sponsored by Institute of Industrial Economics of CASS
ISSN 1006-480X CN 11-3536/F
12 issues per year
Discipline(s): Economics & Finance
Current Issue: Issue 02, 2019
China Industrial Economics is supervised by Chinese Academy of Social Sciences, and sponsored by Institute of Industrial Economics, Chinese Academy of Social Sciences. It aims to report researches on industrial economics and business management, and to reflect outstanding research results on Chinese industrial economy and enterprise development. The scope covers national economy, industrial economy and business management. The journal is included in CSSCI, and is the top journal in the field of industrial economics in China.
Shi Dan, Li Haijian
Redistribution effect of place-based tax preferential policies: evidence from the Western Development Strategy
Place-based tax incentives are an important means of promoting regional economic growth and coordinating regional development, but their negative externalities to areas without tax incentives have not attracted enough attention. Based on the corporate income tax incentive policy in the Western Development Strategy (the statutory tax rate is reduced by 54%), this paper uses the method of difference-in-difference (DID) by transformation the control group, studying the redistribution effect of tax incentives among different regions with different tax rates. We find that: First, corporate income tax incentives can promote tax base growth in the western region, but the growth of the tax base cannot offset the decline in the tax rate, resulting in a significant reduction in income tax revenue in the western region. Second, due to that the turnover tax is not covered in the place-based tax preferential policies, the tax base growth in the western region has indirectly brought about a significant increase in VAT and business tax. Finally, the growth of the tax base in the western region is at the expense of the loss of the tax base in the adjacent regions. The closer it is to the regions covered by the Western Development, the more the losses of their tax base are. The conclusions of this paper indicate that in the process of further improving place-based tax preferential policies, it is necessary to strengthen the construction of supporting systems, reasonably guide the flow of enterprises and factors, minimize the negative externalities of place-based tax preferential policies, and achieve a balance between efficiency and equity when carrying the regional tax incentives.