Premium
Tax enforcement interactions among Chinese provinces: A frontier and spatial analysis
Author(s) -
Chen Longjin
Publication year - 2021
Publication title -
growth and change
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 0.657
H-Index - 55
eISSN - 1468-2257
pISSN - 0017-4815
DOI - 10.1111/grow.12454
Subject(s) - enforcement , incentive , frontier , state (computer science) , public economics , business , economics , political science , market economy , law , algorithm , computer science
Spatial interactions in tax policy have been examined intensively for developed countries. This study presents new evidence of tax enforcement interactions from a developing country. A trend of intensified enforcement on the corporate income tax (CIT) over time is identified among Chinese provinces. Additionally, stringent CIT enforcement in neighboring provinces enhances CIT enforcement in the surrounded province. Furthermore, tax enforcement interactions involve both the state and local tax authorities. The findings not only help to understand the Chinese “regionally decentralized authoritarian system,” but also echo second‐generation fiscal federalism that highlights the role of institutional incentives in shaping intergovernmental fiscal relations.