Effect Analysis and Performance Evaluation of Tax Expenditures

Author: Wan Ying
Publisher:
Publish Date: 2006-05-01
Features: Theoretical innovation is the vanguard of socio-economic development and transformation, as well as the cornerstone of the continuation and progress of human civilization. Innovation is the lifeblood of academic research. Any stagnation, adherence to outdated conventions, or rigidity in theories no longer suited to the times will inevitably be by the times. The world today is undergoing the most rapid, widespread, and profound changes in human history—knowledge and technology are being updated at a much shorter cycle, scientific and technological achievements are being transformed into real productive forces at an unprecedented speed and scale, and the spatial and temporal limitations of human activities are constantly being broken through by information technology. This is undoubtedly the result of innovative thinking, innovative concepts, and theoretical innovation in human minds. The chapter structure of this book is as follows:
Chapter 1, Introduction. Briefly introduces the background and significance of the book's topic, reviews domestic and international research achievements, defines the research scope, methods, and chapter structure of the book, and points out the main innovations and shortcomings of the book.
Chapter 2, The Economic Effects of Tax Expenditures. Based on a thorough reference, summary, and synthesis of previous research achievements, this chapter discusses the impact mechanism of tax expenditures on economic operations from five aspects: tax expenditures and resource allocation, tax expenditures and income distribution, tax expenditures and tax neutrality, tax expenditures and direct expenditures, and tax expenditures and tax competition. It also explores how governments should choose between tax expenditures and direct expenditures and how tax competition has intensified the breadth and depth of tax expenditures across countries and regions. This chapter serves as the theoretical foundation for the entire book's analysis.
Chapter 3, An Overview of the Performance of Tax Expenditures in China. This chapter closely aligns with China's national conditions, elaborates in detail the uniqueness of China's tax expenditures and the social and institutional conditions that constrain the full realization of policy expectations for tax expenditure policies. It provides a comprehensive analysis of the problems in China's tax expenditure policy system as a whole and offers an initial assessment of the performance level of China's tax expenditures.
Chapter 4, Performance Analysis and Evaluation of Incentive Tax Expenditures. From the perspective of expenditure nature, tax expenditures can be divided into two major categories: incentive tax expenditures and supportive tax expenditures. Tax incentives provided to encourage taxpayers to engage in certain economic and social activities belong to incentive tax expenditures, and their performance evaluation focuses on economic efficiency. This chapter selects important tax preference policies such as export tax rebates, preferential treatment for foreign-invested enterprises' income tax, and tax incentives for the development of western China to conduct case performance empirical analysis.
Chapter 5, Performance Analysis and Evaluation of Supportive Tax Expenditures. Tax incentives provided to taxpayers facing difficulties in tax payment belong to supportive tax expenditures, and their performance evaluation focuses on social equity. This chapter selects specific performance analyses for tax incentives for reemployment of laid-off workers, tax incentives for welfare undertakings, and agricultural tax incentives.
Chapter 6, Countermeasures to Improve the Performance of China's Tax Expenditures. In response to the problems in China's tax expenditure system and the practical effectiveness of tax expenditure policies, this chapter proposes that institutional optimization and standardized management should be the starting point for improving the performance of tax expenditure policies. It suggests scientific goal positioning, reasonable goal prioritization, scale control and structural optimization of tax expenditures; enhancing the legal level of tax legislation to avoid the arbitrariness of tax expenditures; improving the fiscal system with a division of powers, moderately expanding local tax legislative authority, and establishing a layered regulatory mechanism within the framework of a decentralized fiscal structure; strengthening tax administration to provide a solid platform for the implementation of tax expenditure incentives; creating conditions to compile a tax expenditure budget, incorporating the tax expenditure budget into the general fiscal budget to enhance transparency; improving statistical indicators and attempting to conduct cost-benefit analysis of tax expenditures to correctly evaluate their advantages and disadvantages.
Conclusion. Based on the analysis results of the entire book, this chapter evaluates the two different attitudes toward tax expenditures in China at the current stage and points out that the immediate priority for reforming China's tax expenditure system is not to intensify efforts but to strengthen legislation, adjust structures, highlight key areas, and improve management. It also proposes establishing tracking, monitoring, evaluation, and assessment indicators for tax expenditures to enhance the performance of policy implementation.