Under the condition of socialist market economy, the state's management of economy has changed from direct regulation to indirect regulation. As an important means for the country to guide and regulate the normal development of the national economy from a macro perspective, tax management is bound to be more centralized. Tax principles and policies that belong to the macro-control of the national economy must be formulated by the central government and supervised by local governments, and the national tax work must be carried out under the unified leadership of the central government. Due to the unbalanced development of regional economy in China, there are great differences in economic benefits and tax affordability. In order to facilitate local governments to deal with some regional tax issues according to local conditions, better organize income and play a role in regulating the economy, local governments should also be given the necessary tax management power. If only the responsibility of the state or local government is stipulated without corresponding rights and legitimate interests, it will inevitably dampen the enthusiasm and initiative of governments and functional institutions at all levels. On the other hand, it is only stipulated that the government and functional institutions enjoy power, and the exercise of rights lacks responsibility constraints, which will inevitably lead to the abuse of power.
People's Republic of China (PRC) State Taxation Bureau implements the vertical management of the organization, establishment, cadres and funds of the State Taxation Bureau system, and cooperates with the provincial people's government to implement the dual leadership of the provincial local taxation bureau. The State Taxation Bureau system includes the state taxation bureaus of provinces, autonomous regions and municipalities directly under the Central Government, the state taxation bureaus of regions, prefecture-level cities, autonomous prefectures and leagues, and the state taxation bureaus of counties, county-level cities and banners. The tax collection sub-bureaus and tax offices are the agencies of the county-level State Taxation Bureau. The former is generally set according to administrative divisions, economic divisions and industries, while the latter is generally set according to economic divisions and administrative divisions.
Local tax bureaus include local tax bureaus of provinces, autonomous regions and municipalities directly under the Central Government, local tax bureaus of regions, prefecture-level cities, autonomous prefectures and leagues, local tax bureaus of counties, county-level cities and banners, tax collection sub-bureaus and tax offices. The local tax bureaus below the provincial level shall be under the dual leadership of the superior and the government at the same level, with the vertical leadership of the tax authorities at the higher level as the main management system, that is, the institutional setup, cadre management, staffing and funds of the local tax bureaus at the regional (city) and county (city) levels shall be managed vertically by the local tax bureaus at the provincial (autonomous regions and municipalities directly under the Central Government).