The empirical analysis to the improvement of local finance system by the full-scale taxation of the real property

Abstract

First, this paper intends to analyses the status and the problems existed in the local finance system of China by comparing with the system of developed countries. Then, we discuss how the reform of real property tax can improve the finance system of the local government by studying the essence and the destination of the real property tax. Next, we choose Beijing, Shanghai, Wuhan and Qingdao to conduct an empirical analysis of how the real property tax can improve the local finance system via studying the size of the local fiscal revenue and expenditure structure. Also, we demonstrate the effect of the full-scale taxation of the real property on local finance system by simulating the taxation in the four cities above. And at last, we get the conclusion of the empirical analysis. © Springer-Verlag Berlin Heidelberg 2014.