Intrinsic stabilizer

The so-called "intrinsic stabilizer" refers to such an internal macroeconomic adjustment mechanism: it can automatically function in the case of macroeconomic instability, so that The macroeconomy tends to be stable. This "internal stabilizer" effect of fiscal policy can directly produce regulatory effects without resorting to external forces. This inherent and automatic stabilizing effect of fiscal policy tools can play a regulatory role on its own with the development of social and economic development. Dedicated government intervention is required. The "inherent stabilizer" effect of fiscal policy is mainly manifested in two aspects: the progressive income tax system and the role of public expenditure, especially social welfare expenditure.

1. Progressive income tax system

Progressive income tax systems, especially corporate income tax and progressive personal income tax, are very sensitive to changes in the level of economic activity. If the government's budget balance is balanced and the tax rate does not change, but economic activities are sluggish, national production will decrease, resulting in an automatic decrease in tax revenue; if the government budget expenditure remains unchanged, the decrease in tax revenue will lead to a budget deficit. This will "automatically" generate the power to stimulate demand to restrain the continued decline in national production.

2. Public expenditure, especially social welfare expenditure

Under a sound social welfare and social security system, various social welfare expenditures will generally increase with the prosperity of the economy. And automatic reduction, which helps to curb excessive expansion of demand, will also automatically increase with the economic depression, which helps to prevent the contraction of demand, thereby promoting economic stability. If there is a recession in the national economy, many people will be eligible to apply for unemployment benefits. The government must pay subsidies or benefits to the unemployed so that they can maintain necessary expenditures so that the total demand in the national economy does not drop excessively. Similarly, if the economic boom comes and the unemployed can regain job opportunities, when the aggregate demand is close to the full employment level, the government can stop this kind of relief expenditure to prevent the aggregate demand from being too strong.

Multiplier effect

The multiplier effect includes both positive and negative aspects. When government investment or public expenditure expands and tax revenue decreases, it will double the effect on national income, thus producing a macroeconomic expansion effect. When government investment or public expenditure is reduced and taxes are increased, it will have a doubling contraction effect on national income, thus producing a macroeconomic contraction effect.

1. Multiplier effect of investment or public expenditure

It refers to the increase or decrease in national income caused by changes in total social demand caused by changes in investment or government expenditure. degree of influence. The investment expenditure of one department or enterprise will be converted into the income of other departments. This department will use the income after deducting savings for consumption or investment, and then it will be converted into the income of another department. If this cycle continues, national income will increase at a multiple of investment or expenditure. The above principles also apply to reductions in investment. A decrease in investment will lead to a decrease in national income at a multiple of investment. The corporate expenditure multiplier works on the same principle as the investment multiplier. 2. Tax multiplier effect

It refers to the degree to which an increase or decrease in taxation reduces or increases national income. As taxes increase, consumption and investment demand will fall. A decline in the income of one department will cause a decrease in the income of another department. If the cycle continues, national income will decline at a multiple of the increase in tax revenue. At this time, the tax multiplier will be negative. On the contrary, due to the reduction of taxes, private consumption and investment increase, thereby affecting the national income to increase more through the multiplier. At this time, the tax multiplier is positive. Generally speaking, the tax multiplier is smaller than the investment multiplier and the government public expenditure multiplier.

3. Budget balance multiplier effect

The budget balance multiplier effect refers to a situation: when the expansion of government spending is equal to the increase in taxation, the increase in national income The expansion is exactly equal to the expansion of government spending or the increase in taxation. When the decrease in government spending is equal to the decrease in taxation, the contraction of national income is exactly equal to the decrease in government spending or the decrease in taxation.

Reward and suppression effect

The reward and suppression effect mainly refers to the government’s influence on certain regions, departments, industries, products and certain areas of the national economy through financial subsidies, various reward and punishment measures, and preferential policies. The effective impact produced by encouraging, supporting or restricting or punishing certain economic behaviors.

Currency effect

1. Currency effect directly affects currency circulation

It is manifested in government investment, public expenditure, fiscal subsidies, etc. which themselves form part of social currency. purchasing power, thus having a direct impact on currency circulation and producing a monetary effect.

2. The monetary effect of public debt policy

The monetary effect of fiscal policy is mainly reflected in public debt. The monetary effect of public debt policy depends on the objects of public debt subscription and the source of funds. If the central bank uses banknotes to purchase public bonds, this is tantamount to the issuance of banknotes, which will produce an inflationary effect; if commercial banks purchase public bonds and can use public bonds as reserves to increase loans, it will also lead to the issuance of currency, thereby increasing the amount of money in circulation. Money increases and so on. Since my country implemented an expansionary proactive fiscal policy, researchers have repeatedly suggested that this macro policy will have a crowding-out effect on private investment. Some people abroad have also expressed concerns about whether China's large-scale issuance of government bonds, increase in government investment, and expansion of expenditure will produce a crowding-out effect.

The so-called "crowding out effect" refers to the fact that the government implements expansionary policies by borrowing from enterprises, residents and commercial banks, which causes interest rates to rise, or causes competition for limited credit funds, causing the private sector to Investment decreases. It will partially or even completely offset the effects of government expansionary fiscal spending.

The crowding-out effect is not bound to occur when the government implements expansionary fiscal policy adjustments. Looking specifically at China's practice of implementing active fiscal policies, based on the analysis of various indicators of economic operation, the view that a crowding-out effect occurs in my country is not yet supported by strong evidence. This can be examined from the impact of additional issuance of treasury bonds on the following three aspects:

The impact of additional issuance of treasury bonds on interest rates

Since May 1996, nominal interest rates have been lowered many times in my country, but Real interest rates are rising, and this is not the result of fiscal expansion. Since China has not yet implemented marketization of nominal interest rates, active fiscal policy will not affect the rise or fall of nominal interest rates. The rise in the real interest rate is mainly due to the decline in the price level, and the central bank did not adjust the nominal interest rate in time with the price changes due to various considerations. Looking further, the decline in the price level is not the result of fiscal expansion. On the contrary, active fiscal policy has suppressed the decline in price levels.

The impact of additional issuance of treasury bonds on the amount of borrowing funds

The additional issuance of treasury bonds does not compete with the private sector for limited funds. In the past few years, the excess reserve ratio of commercial banks has exceeded 70, and there has been a large deposit-loan gap. The excess funds of commercial banks are mainly due to increased risk awareness, low corporate investment returns, poor expectations and adjustments to industrial policies. Moreover, this excess is after meeting the government's borrowing needs.

From the perspective of actual economic operation, private investment is mainly affected by the marginal product or profit rate of private capital and public investment. An increase in the marginal product of private capital will cause an increase in the scale of private investment. If public capital is invested in competitive fields, that is, production with private capital can be substituted for each other, increasing public investment is likely to crowd out private investment. The investment areas of active fiscal policies are mainly ecological environment protection, highways, railways, water supply and airports, grain depots, rural power grids and other infrastructure, which belong to the field of social public expenditure and will not have a crowding-out effect on private investment. On the contrary, infrastructure construction can also improve the external environment for private investment, increase the marginal productivity of private capital, and promote private investment.

The impact of fiscal expenditure on household consumption

Government expenditure and household consumption have a substitution relationship, that is, fiscal increases in government purchase expenditure may crowd out household consumption. But this can only be determined through detailed analysis of the fiscal expenditure structure.

Certain fiscal expenditures, such as entertainment expenses, are indeed substitutes for private consumption; expenditures on public facilities are complements of private consumption; and some public expenditures are both substitutes and complements of private consumption, such as The state's expenditure on food and drug inspection not only reduces private quarantine expenditures, but also increases private expenditures on food and medicine. Relevant departments have found through econometric model analysis of the relationship between fiscal purchase expenditures and household consumption that my country's fiscal purchase expenditures and household consumption are generally complementary, and expanding government expenditures has an overall expansion effect on demand. The effectiveness of the use of national debt funds is directly related to the overall effect of proactive fiscal policies and the risk control of expanding debt scale. The higher the efficiency of the use of national debt funds, the more the effect of expansionary policies will tend to the "high multiplier effect" end, and the greater the safe space for the government to expand the scale of borrowing.

To improve the efficiency of the use of national debt funds, I believe that at least the following levels or links must be mastered:

1. Reasonable selection of capital investment projects and sufficient feasibility demonstration

2. Project construction. The coordination and connection with relevant parties should comply with the requirements of scientific planning and reasonable construction standards.

3. Ensure that established project funds are not misappropriated and are allocated according to progress.

4. Effectively ensure the quality of the project.

In the past few years, the results of construction projects and technological transformation projects supported by government treasury bonds and other supporting funds have been generally obvious. In the inspection of construction projects by the inspection team, problems still exist at all levels, from options, supporting planning, fund earmarking to project quality, some of which are quite serious. For example, first, some construction projects were not adequately prepared for the original projects. Under such circumstances, if a hasty decision is made to launch the project, the feasibility demonstration is very insufficient; secondly, some projects do not follow the infrastructure construction procedures, and the project proposals are not approved before they are launched with great fanfare; thirdly, the preparatory work of some projects is in-depth It is not enough, and construction is started even if the conditions are not met; fourth, there are obvious deficiencies in some urban planning, and even the unified consideration of water supply, drainage, and sewage treatment is not done; fifth, the engineering quality of individual projects has serious problems, and even becomes a "Tofu" projects; Sixth, regional and departmental protectionism in project bidding and supervision is often serious; Seventh, construction funds for national debt projects have also been misappropriated in a few areas.

In response to the above problems, relevant departments issued documents such as the "Notice on Further Strengthening the Quality Management of Special Fund Projects within the Fiscal Budget", requiring the establishment of clear standards for all aspects of construction projects such as survey and design, bidding, construction management, and completion acceptance. The responsible person system will stop the allocation of funds for projects with problems discovered during supervision and inspection until they are corrected. For projects where misappropriation of funds occurs, funds will be stopped until the rectification is completed and the misappropriated funds will be recovered, and the responsibilities will be investigated, etc.

These inspection, supervision, error correction, punishment and strengthening of management measures have played a positive role in improving the efficiency of the use of national debt funds. In the past two years, there have been problems with the misappropriation of funds from national debt projects and low project quality. Relatively reduced. In the future, it is still necessary to attach great importance to relevant links and make unremitting efforts, because generally speaking, our lack of relevant management experience, imperfect systems, and gaps in construction supervision and quality assurance systems compared with international levels, After all, it is a reality that must be faced squarely. One of the controversial questions about active fiscal policy since 1998 is "why tax cuts were not implemented." According to general logic, expansionary fiscal policy includes two aspects: tax cuts and increases in government spending. After 2018, China’s fiscal and taxation policy will increase expenditures without reducing taxes under the guidance of expansion? Strictly speaking, it does not focus on tax reductions. The reasons are mainly as follows:

P. First, the proportion of China's tax revenue in GDP is too low. From a macro tax burden perspective, there is no room for tax reduction. The ratio of tax revenue to GDP in developing countries is generally 20-30%, and the ratio in developed countries is even higher. In my country, this ratio was only about 11% in 1997. It can be said that there is generally no room for tax reduction.

In real life, there is indeed the problem of excessive burdens on enterprises and farmers, and there are strong calls to reduce the burdens. However, a specific analysis shows that the reasons are arbitrary extra-tax charges, arbitrary fines, arbitrary apportionments, and arbitrary fund-raising. At the same time, various departments and power links have passed Most of the financial resources collected for the "four chaos" were placed outside the budget and dispersed, which was full of disadvantages. Therefore, the problem that our country urgently needs to solve is to clean up the "four chaos", rectify non-tax revenue, reduce extra-tax burden, and strengthen the management of extra-budgetary funds, rather than reducing taxes.

Second, China’s current tax system structure restricts the effect of tax cuts, making tax cuts less effective and more costly than gains. The so-called "stabilizer" effect of taxation on the economy mainly refers to the regulatory role of direct taxes, that is, income tax. At this stage, the main body of taxation in our country is indirect taxation. Around 1997, the proportion of value-added tax, consumption tax, and business tax in tax revenue was as high as 65%. Above, the total of corporate income tax and personal income tax only accounts for about 16%. Nearly half of businesses are operating at a loss, and lowering income taxes means nothing to them. Reducing or reducing indirect taxes will not only significantly reduce fiscal revenue, but also have a weak effect on stimulating the economy, resulting in half the effort with half the effort. Tax cuts coupled with indirect taxes have the effect of pulling down prices, which may worsen deflation and are not conducive to improving market expectations.

Third, China’s current economic and tax environment is not suitable for focusing on tax cuts. At present, our country's market system is not yet sound, and the investment and operating behaviors of enterprises are far from being on a standardized track. A considerable number of enterprises are not responsive to tax reduction signals. In particular, the long-term practice of promoting local economic development through various ultra vires and arbitrary tax reductions and exemptions still has a certain degree of inertia. This type of practice objectively encourages the occurrence of various tax evasion and tax fraud phenomena and weakens the leverage effect of taxation. The management department is worried that emphasizing tax reduction under such circumstances will not only be difficult to achieve the expected results, but may also disrupt the tax order and hinder the formation and stability of the tax law enforcement environment.

It should be pointed out that it is a misunderstanding to believe that tax growth can never be higher than GDP growth. In fact, only when the management system and tax structure are relatively stable and mature, the proportion of tax revenue to GDP will not fluctuate significantly. However, my country's economic development is still in a period of transformation, both the institutional and tax systems are in the process of transition, and many factors are undergoing drastic changes. Therefore, to be realistic, it is not appropriate to simply use a relatively stable framework of tax revenue as a share of GDP to apply to China's reality.

There is a certain rationality in the continued growth of tax revenue in my country after the mid-1990s. First, to a certain extent, it is a normal correction after the tax-to-GDP ratio declined excessively in the previous decade. The decentralization reform and tax reduction and profit-sharing arrangements that began in the 1980s have reduced the proportion of my country's tax revenue to GDP to less than 10 in the early 1990s. From international experience, this proportion in developing countries is as large as Above 20, it is much higher in developed countries. After adjustments, my country's tax revenue has only reached close to 15% of GDP, so the macro tax burden is not high. In 1999, the total amount of tax collection exceeded one trillion yuan, which was directly related to the increased efforts to clear debts. This is also the reason why large tax arrears in the past felt a huge impact. However, in order to form a fair competitive market environment, flexible collection should be reduced, collection and management should be strengthened, and tax constraints based on law should be hardened. The increase in taxes to combat smuggling is completely reasonable.

Of course, as a specific case, arbitrary collection and "over-taxation" do exist in real life. Therefore, it is urgent to improve the law enforcement level of the collection and management team and strengthen their supervision. In addition, distortions such as "listing revenue and expenditure" and "loans being idle" were also found to be fraudulent simply to ensure tax compliance. A constructive suggestion is that the next step is to create supporting conditions and transform taxation indicators into predictive and guiding indicators like GDP, on the premise of acknowledging the need to further improve the rule of law and strengthen tax collection and management. On the basis of paying taxes and collecting taxes in accordance with the law, we can then learn from the experience of market economy countries and use short-term treasury bonds to adjust the gap in fiscal revenue and expenditure that may be caused by the difference between the tax forecast and the actual tax collection.

Although generally speaking, there is not much room for tax reduction in China, it does not rule out tax reduction and exemption on specific projects, such as the enlarged export tax rebates, the suspension of fixed asset direction adjustment tax, Policies such as corporate investment credits for new income taxes40 will have positive effects in encouraging investment and stimulating consumption. Since the launch of proactive fiscal policy, after the scale of my country's national debt has expanded with the size of the deficit and other changing factors, whether it is still controlled within an appropriate range and whether the sustainable development of the fiscal economy can be guaranteed is an important issue that must be considered, and is also related to the policy. The examination of the overall effect is closely related. From the perspective of nominal indicators, although our country's finances are in a difficult situation, the proportion of the national debt balance in the GDP is still relatively low. At the end of 1998, the debt balance in the GDP was about 10.3%. Of the 270 billion yuan in special government bonds in capital, this ratio is only about 13.6, which is significantly lower than the same ratio in most countries. Although the ratio of national debt balance/GDP has increased, it has still not reached 20. The main problem in our country is that the central government’s debt dependence ratio (the current year’s debt amount/the current year’s expenditure amount) is too high, already around 70, and the nominal indicators are far from reflecting the actual situation. In this regard, it seems that at least the following interrelated aspects should be taken into consideration:

First of all, the ratio of national debt balance/GDP is an indicator that more comprehensively and comprehensively reflects a country’s borrowing potential. Although the first indicator is very low, the central government's debt dependence is relatively high. This is related to the current institutional factors, such as not allowing local governments to borrow debt and the degree of dispersion of government financial resources. A considerable amount of extra-budgetary government funds are not included in the debt dependence indicator. The denominator reflects a large relationship.

Second, the issuance of additional government bonds for government investment in recent years is a countercyclical fiscal measure taken under specific conditions. It does not mean that the long-held principles of controlling debt scale and reducing deficits have been abandoned. In other words, this kind of counter-cyclical emergency measures must not be used as a routine and used every year.

Third, the expenditure arrangement of borrowing to expand the scale of investment also has expenditure rigidity, that is, the "ratchet effect." The increased expenditure base and construction plate will create pressure for more financial investment in subsequent years. It also includes the pressure of arranging debt repayments; therefore, it is necessary to carefully coordinate short-term adjustments and mid- to long-term development, rationally mobilize funds, and avoid forming too steep a debt repayment peak and even a government debt crisis and unsustainable expenditure plate. Under the current conditions, to increase the issuance of government bonds, we should issue more long-term bonds? For example, ten years, fifteen years, twenty years, or even longer, and use the opportunity of low inflation to reduce the total cost of government debt financing.

Fourth, how to rationally use the funds raised through debt to produce the greatest possible economic and social benefits is a key issue. As mentioned before, it should be admitted that our management level in this area is not high yet and our experience is still quite limited. It is necessary to pay full attention to it, make practical improvements, explore the form of special treasury bonds, and strengthen the overall scientific planning, feasibility research and comprehensive utilization of treasury bond funds. Strict accountability of the process.

Fifth, the current fragility of the central finance deserves great attention. Necessary institutional adjustments and strengthening of management measures must be adopted to reverse the decline in the proportion of central finance revenue in national fiscal revenue year after year and strengthen the central finance. control strength.

Finally, from a broader perspective, it should be acknowledged that my country’s nominal deficit and national debt indicators are far from reflecting the full reality of the situation. Therefore, the nominal fiscal deficit and national debt scale must be consistent with the hidden deficit. Considered at the same time as the national debt, in other words, the nominal scale expansion will actually be reduced to digest and make up for the hidden deficits of the public sector and hidden national debts in the safe zone, such as arrears of wages at all levels of government, losses in the food system, and state-owned enterprises. The availability of debts between enterprises and state-owned banks and non-bank financial institutions, as well as debts borrowed by various departments and local governments that are similar in nature to sovereign bonds, as well as government contingent debts, such as empty accounts of pension funds and dead accounts of rural mutual aid cooperation funds. Space and room for adjustment. We must pay full attention to problems in this area, gradually resolve risks through comprehensive management and supporting reforms, and seek solutions by "treating both the symptoms and the root causes."

If we only look at the nominal deficit and national debt indicators and conclude that "my country still has a lot of room for debt issuance", it is very easy to lead macro-control into misunderstandings, that is, it should be reserved for "treating the root cause" operations such as the strategic restructuring of the state-owned economy. The space for debt issuance is exhausted when the symptoms are addressed.

In short, while the scale of my country's fiscal deficit and national debt is appropriately expanding, we must strengthen risk awareness and prevention mechanisms, comprehensively grasp the actual situation, carefully and securely grasp the reasonable quantitative limits of deficit and debt, and increase the national debt While expanding the total size, we should make reasonable adjustments to the structure of national debt, and connect counter-cyclical emergency measures with medium- and long-term sustainable development and deepening reforms, and strive to win the time and conditions to overcome deep-seated contradictions in systems, structures, etc. through counter-cyclical adjustments. As well as a comprehensive environment of virtuous financial and economic cycles, it is possible to usher in a new round of rapid growth of the national economy. A prudent fiscal policy is a "neutral" fiscal policy in the economic sense, that is, fiscal revenue and expenditure remain balanced and do not have an expansion or contraction impact on total social demand. Our country's implementation of prudent fiscal policy is based on scientific judgment and accurate grasp of the new situation of economic development. It is a realistic choice to strengthen and improve macroeconomic regulation and control, and is a new measure under the new situation. Stable fiscal policy is not only an adjustment and change in the name of fiscal policy and deficit scale, but also a fundamental transformation of the nature and direction of fiscal policy. Its scientific connotation can be summarized as "controlling deficits, adjusting structures, promoting reforms, increasing revenue and reducing expenditures." Implementing a prudent fiscal policy does not mean that fiscal policy does nothing or does nothing in strengthening and improving macroeconomic control. On the contrary, fiscal policy should play a more important and positive role in eliminating unhealthy and unstable factors in economic development and stabilizing macroeconomic operations. At present, the following measures can be taken to give full play to the effects of prudent fiscal policy.

Appropriately adjust the scale and direction of treasury bond investment

At present, our country should gradually reduce the scale of long-term construction treasury bonds and optimize the structure of treasury bonds and fiscal expenditures. Taking into account that policies must maintain relative continuity, national debt investment projects require follow-up funds to complete, so reducing the deficit and suppressing national debt must be a gradual process. In the direction of investment and use of treasury bonds, we must achieve "security and control." The so-called "guarantee" means that the use of government funds will focus on the strategic development goals established in the national development plan and key projects in agriculture, forestry, water, ecological protection and land remediation, the development of the western region and the revitalization of the old industrial bases in the Northeast, as well as those related to the public sector. The construction of infrastructure and supporting conditions that are closely related to the health system, education, scientific and technological progress, and social security. The so-called "control" means that the government's primary consideration should be public products and services that the market cannot effectively provide, and government funds will withdraw from generally competitive and for-profit investment projects. Therefore, government bond funds should focus on improving the social security system, solving rural issues, accelerating the development of the western region, and revitalizing old industrial bases such as the Northeast. At the same time, infrastructure projects that create bottlenecks in high-tech industries and emerging leading industries that are conducive to technological upgrading and optimization of departmental structures, as well as public products and some quasi-public products that are needed for the overall development of society, such as ports, , railways, electricity, resource exploration and other projects that are difficult to solve relying on local finance will continue to provide support.

Focus on the driving role of consumption in economic growth

The implementation of prudent fiscal policies indicates that consumption will play a more important role in economic growth. Under the policy of expanding domestic demand in the past seven years, investment demand and consumer demand among the "Troika" are very strong, but consumer demand has always been a "short board" and has not played its due role. In 2003, China's consumption accounted for only 55% of GDP, nearly 15 percentage points lower than the world average. From January to September 2004, the total retail sales of consumer goods nationwide increased by 13% year-on-year, and the actual growth after deducting price factors was 9.7%. This speed is clearly far behind the investment growth of 27.7% and the export growth of more than 35%. Therefore, effective measures must be taken to improve people's consumption levels and enhance the driving role of consumption in the economy. The first is to create more job opportunities and increase people’s income levels. Employment is the foundation of people's livelihood. Only when everyone has a job and a stable income can consumption be effectively stimulated.

The second is to strictly curb the rise in housing prices and real estate speculation in big cities, while supporting and satisfying the growth of residential mass consumption, reducing automobile consumption tax rates, standardizing and promoting the development of automobile consumption credit, and encouraging the consumption of economical cars. The third is to continue to implement policies that are conducive to increasing farmers' income and enhance farmers' purchasing power. Generally speaking, our country has reached a stage of development in which industry is used to promote agriculture and cities are used to promote rural areas. We should gradually increase efforts to support agriculture, start from improving the comprehensive agricultural production capacity, take more effective measures, strengthen the construction of agricultural infrastructure, and improve rural production and living conditions. The fourth is to reform the distribution system, improve social expectations, improve the social security system, and narrow the gap between rich and poor, thereby increasing the purchasing power of those who want to consume but have no money.

Promote tax system reform and strengthen tax collection and administration

By further improving the tax system and continuously enhancing the ability of enterprises to develop themselves, it is conducive to encouraging enterprises to expand investment, accelerate technological transformation, and establish a platform for independent and stable economic growth. intrinsic mechanism. To this end, first, promote the transformation and reform of value-added tax. Although promoting the VAT transformation reform will lead to a reduction in tax revenue in the short term, it will help cultivate tax sources, make the "cake" bigger, and help promote the development of enterprises. Second, promote the unification of income taxes for domestic and foreign-funded enterprises. The integration of income taxes for domestic and foreign-funded enterprises must set up a reasonable transition period so that the overall macro tax burden level of foreign-funded enterprises does not change significantly and create a good tax environment for fair competition among enterprises. Third, reform and improve the agricultural tax and fee system. Continue to promote the pilot reform of agricultural tax reduction and exemption, deepen the reform of rural taxes and fees, and build a solid foundation for agricultural development and farmers' income increase. Fourth, improve the local tax system, reform existing tax types in conjunction with tax and fee reforms, and introduce or suspend the collection of some tax types. On the premise of unifying taxation, local governments should be given appropriate tax management rights. Fifth, further improve the export tax rebate system.

Generally speaking, strengthening tax collection and management can bring about a rapid increase in the actual tax collection rate, thereby greatly shortening the distance between the institutional tax burden and the actual tax burden. However, for the implementation of a "stable" fiscal policy, strengthening tax collection and management can reduce the disposable income of non-governmental sectors and reduce expansion factors in economic operations. This is an important measure consistent with the goal of a sound fiscal policy. Specifically: First, we must strengthen tax collection and management in accordance with the law, plug various loopholes, and ensure that all receivables are collected. Clean up and standardize preferential tax policies in accordance with the law, and strictly control tax reductions and exemptions. Second, we must strictly control general expenditures to ensure key expenditure needs, and all financial expenditures must be calculated carefully. Third, we must actively explore and establish a performance evaluation system for fiscal funds, strengthen supervision and inspection, strictly manage, resolutely stop extravagance, waste, and lavish spending, and effectively improve the standardization, safety, and effectiveness of the use of fiscal funds. Fourth, we must make scientific use of excess revenue in budget execution and generally cannot make rigid expenditure and investment arrangements.

4. Continuously carry out institutional innovation and improve the public financial system

According to the requirements of the public financial system, the government’s first priority should be to provide public funds that the market cannot effectively provide. **Products and Company **Services. For generally competitive and profitable investment projects, government funds should be withdrawn to maximize the market's advantages in allocating resources in these areas. In those areas where the market cannot or cannot do well, the government must do it. The government should provide a good external environment for fair competition and survival of the fittest among market entities through the effective implementation of various means. First of all, it is necessary to accurately define government functions. The government should shift its functions from developing the economy and opening up financial resources to public services. Public finance should enter the areas where it should play a role and eliminate "dislocation", "offside" and "absence". "Phenomenon. Secondly, we must scientifically handle the relationship between governments at all levels, correctly divide administrative and financial rights, standardize and scientifically determine the basis of revenue and expenditure in accordance with the law, and establish government distribution relations on the basis of a combination of responsibilities and rights. Further rationalize the relationship between the central and local financial and administrative powers, and reform and improve the provincial fiscal system. Increase financial transfer payments to grassroots governments below the county level. Thirdly, determine the scope of government public expenditure according to social public needs. Government reform expenditures should be concentrated in three areas, namely maintenance expenditures, transfer expenditures and public engineering expenditures. Finally, we must continue to deepen the reform of government institutions.

The essence of the public finance concept is service finance. In accordance with the requirements of this concept, an administrative agency that adapts to the needs of the modern market economy and implements new public finance management should be established to continuously improve the level of government services. The dependence effect is reflected in two aspects: development dependence and institutional dependence. Development dependence refers to the obvious dependence of effective economic growth on proactive fiscal policies. It seems that to maintain economic growth above 7, proactive fiscal policies must be implemented; institutional dependence refers to the administrative investment selection mechanism. layers of administrative dependence, and causes enterprises to consciously or unconsciously lean towards the latter in the choice between market dependence and government dependence, which will objectively amplify the curbing effect of government and administrative mechanisms on the market and market mechanisms. .

The negative effects of the above four aspects have gradually begun to appear in our country's economic operation, and should attract the full attention of the government and relevant departments. In view of the actual situation of the world economy and our country's economy, it is not possible to fade out the active fiscal policy in the short term. Therefore, in the process of continuing to implement the active fiscal policy, this policy should be given a more complete reform connotation, and it should be included in the policy. Necessary or even relatively large adjustments must be made in the direction and mechanism of action in order to organically combine and coordinate the implementation of proactive fiscal policies with the marketization and internationalization process of our country's economy.

First of all, treasury bond investment must make more use of market mechanisms, and the marketization process of treasury bond investment and fiscal policies must be transformed into public finance and the cultivation of socialized investment systems and investment mechanisms must be organically In order to accelerate the marketization process of investment system and investment mechanism, we can establish a socialized investment mechanism and promote the smooth conversion of savings and investment.

Secondly, the issue of tight matching of fiscal policy and monetary policy must be fully considered and put on the agenda, and efforts must be made to build the institutional basis for such policy matching and coordinated use, thereby greatly promoting fiscal policy. and the pace of market-oriented transition of monetary policy.

Thirdly, active fiscal policy must not only expand its denotation and make incremental changes, but also pay more attention to the improvement of its connotation and the adjustment of its stock. In particular, efforts must be made to reduce state-owned shares and adjust taxes. Two major articles, in order to gradually put my country's economic development into a virtuous cycle and gradually realize the return of government functions and policy functions to the market.