in recent years, there have been some contradictions and problems in the process of rapid economic growth in China, which have had a certain impact on the transformation of China's economic development mode. These problems are mainly manifested in the following aspects: 1.1 Excessive energy consumption Over the past 2 years since the reform and opening up, China has achieved a high-speed growth with an average annual growth rate of over 9%, but the growth is mainly driven by investment, and the growth mode is relatively extensive. Blind investment and low-level redundant construction in some industries have achieved output growth, but at the cost of consuming a lot of resources and energy, which is not only conducive to the adjustment and optimization of industrial structure, but also to the healthy development of the national economy. In 26, China produced only 5.5% of the gross domestic product, accounting for 15% of the world's total energy consumption, 3% of steel consumption and 54% of cement consumption. In the past 2 years, the average elasticity coefficient of energy demand was .5, but it exceeded 1. during the Tenth Five-Year Plan period. China's Tenth Five-Year Plan predicts that the emission of major pollutants will be reduced by 1% in 25, of which the emission of sulfur dioxide will be reduced from 19.95 million tons in 2 to 17.96 million tons in 25, but it will increase by 27%, reaching 25.49 million tons. From the comparison of energy consumption between China and seven western developed countries (Table 3-1), G-7 countries consume n.7*1O(6) coke on average to create a dollar of GDP, while China consumes 69*1(6) coke for every dollar of GDP, which is 5.9 times the average of seven western developed countries, 4.3 times that of the United States and 7.7 times that of Germany and France. This shows that China's economic growth mode is extensive. 3.1.2 Environmental pollution is serious. For a long time, China's rapid economic growth has not placed environmental pollution in an important position, but has continued the road taken by western countries in the early stage of development, developing the economy first and then controlling environmental pollution. Industrial waste gas, waste residue and waste water pollute the environment, especially rivers, which directly endanger people's health. For example, 54% of the seven river systems in China are polluted to varying degrees, and 76% of the rivers are polluted. The development of industrial economy consumes a lot of resources, which leads to a sharp increase in carbon dioxide in the air and a large amount of solid waste, which pollutes the environment. The level of waste discharge in China is much higher than that in developed countries. The waste water discharge per unit of GDP is four times higher than that in developed countries, and the solid waste produced per unit of industrial output value is more than 1 times higher than that in developed countries. In 26, the total discharge of industrial and domestic wastewater in China was 45.3 billion tons, including 13.48 million tons of chemical oxygen demand, ranking first in the world, 21.2 million tons of sulfur dioxide, ranking first in the world; The annual emission of carbon dioxide is second only to the United States, ranking second in the world. At the beginning of 25, the World Economic Forum in Davos published the latest evaluation of "Environmental Sustainability Index". Among 144 countries and regions in the world, China ranked 133rd, and among the more than 2 most polluted cities in the world, 16 were in China. According to the estimation of China Academy of Sciences in 23, the losses caused by environmental pollution and ecological destruction in China account for smart% of GDP. (1) At present, China's laws and regulations on environmental protection are not perfect, the introduction of fiscal policies is lagging behind, and the support of public fiscal policies for circular economy is not enough. For example, there are too few taxes related to environmental protection. At present, only resource tax and income tax are related to environmental protection, and other main taxes have no preferential policies for projects that comprehensively utilize "three wastes", which limits the regulation and control of tax on environmental pollution, and it is difficult to form a special source of tax revenue for environmental protection, weakening the role of tax in environmental protection; There is a lack of restriction on emission pollution projects. Some taxes are tax-free for environmental protection projects themselves, but they have no restriction on pollution discharge projects. At the same time, those pollution-free products and cleaner production that are conducive to environmental protection do not enjoy preferential tax policies. As far as the existing resource tax related to environmental protection is concerned, the tax rate is too low, the gap between different files is too small, and the scope of taxation is narrow, which can not obviously regulate the rational utilization of resources, which is extremely disproportionate to the shortage of resources, low utilization rate and serious waste in China. Because most of the resource tax revenue belongs to the local government, in the implementation process, it is because the income obtained from the use of natural resources such as coal, oil, natural gas and salt is taxed. It often plays a role in encouraging local over-exploitation of resources, but it has aggravated the deterioration of the ecological environment. 1.3 Inconsistent investment and consumption relations China has long relied mainly on investment and exports, especially on high investment to stimulate economic growth, and consumption has been insufficient for a long time. According to statistics, since 23, the annual growth rate of China's fixed asset investment has remained at around 25%, and the proportion of capital formation in GDP has exceeded 4%. However, the proportion of China's final consumption in GDP (consumption rate) decreased from over 62% in 198s to 5% in 26, while the world average consumption rate was 8.1%(22), which was 28 percentage points lower than the world average. From the international comparison, the proportion of China's consumption expenditure, especially household consumption expenditure, in GDP is not only much lower than that of developed countries, but also much lower than the average level of developing countries. However, the proportion of investment is too high, which is 2 times and 1.6 times of the average proportion of developed and developing countries respectively (see Table 3-2). Judging from some countries with developed economies and high openness in the world, whether it is the United States, Japan or several big countries in Europe, the first factor to promote economic growth is consumption. For example, the United States is the largest import and export country in the world, but the contribution rate of exports to the economy is only over 1%, and its impact on economic growth is far behind domestic consumption. The consequence of high investment and low consumption is low investment efficiency, overcapacity in some industries, which affects the adjustment of industrial structure, the improvement of the overall quality of life of residents, and ultimately the sustainable development of the economy. 1.4 Unreasonable industrial structure At present, China's industrial structure is unreasonable, traditional industries still dominate, and the proportion of high-tech industries is low. In terms of the three industrial structures, there are still problems such as weak agricultural foundation, low industrial quality and lagging development of service industry. Since 24, the investment in steel, cement and electrolytic aluminum in China has grown too fast, which has not only caused these products to rise in turn, increased the pressure of overall price increase, but also further aggravated the contradiction of industrial structure. Due to the contradiction between supply and demand in the market, the price of steel products has risen, which has led to the blind expansion of the steel industry. Such a production scale will inevitably lead to high input, waste of resources, environmental pollution and low efficiency. Since the reform and opening up, the proportion of the primary industry in China has dropped significantly, the proportion of the secondary industry has remained basically the same, and the proportion of the tertiary industry has increased substantially. The proportion of the added value of the three industries in GDP was adjusted from 28.2:47.9:21.9 in 1978 to 11.3:48.6:4.1 in 27. Compared with 1978, the proportion of primary industry decreased by 16.9 percentage points, the proportion of secondary industry increased by .7 percentage points and the proportion of tertiary industry increased by 16.2 percentage points in 27. However, from an international perspective, the proportion of primary and secondary industries in China, especially the material capital-intensive secondary industry, is still too high, while the proportion of the tertiary industry with relatively dense human capital is still too low: not only lower than the world average, but even significantly lower than the average level of low-income countries (see Table 3-3). From the perspective of the pulling effect of the three industries on GDP growth, since 23, China's GDP growth rate has been above 1%, but the contribution rate of the primary industry is all above 1%. The contribution rate of the primary and tertiary industries to economic growth is relatively low, while the contribution rate of the secondary industry is too high. In the 198s, China's township enterprises rose rapidly. At the same time, China implemented reform and opening up, introduced a large number of foreign capital, and mainly developed processing industries. In the late 199s, China became the main target of processing industry transfer in developed countries and regions, thus rapidly expanding into the "processing workshop" of the world. The rapid expansion of the secondary industry has become the main reason for the vigorous development of China's economy since 198s, and it is also the basic feature of the stage of industrialization development. The rapid industrialization development process has also brought some sequelae to the society, such as the extreme waste of resources, the serious pollution of the environment, the relative backwardness of agriculture and the underdevelopment of the tertiary industry. China is currently in the middle stage of industrialization, and the service industry accounts for less than 4% of GDP, while the internationally developed countries generally account for more than 7%. The disharmony among the three industries has affected not only the healthy development of the whole social economy, but also the sustainable development of the secondary industry itself. From the employment ratio of the primary, secondary and tertiary industries (the proportion of employees in each industry to the total employment), it was 4.8:26.8:32.4 in 27. Compared with 1978, in 27, the proportion of employment in the primary industry dropped by 29.7 percentage points, that in the secondary industry increased by 9.5 percentage points, and that in the tertiary industry increased by 2.2 percentage points. However, the proportion of the added value of the three industries in China is seriously disproportionate to its employment structure: the added value of the primary industry only accounts for 11% of GDP, but it concentrates more than 4% of the employed people; The added value of the secondary industry accounts for nearly half of GDP, but only absorbs more than 1/4 of the employed people; Although the added value of the tertiary industry is basically commensurate with its employment proportion, compared with the international level, its employment proportion is less than half of the average level of developed countries and much lower than that of many developing countries (see 3-4). Therefore, vigorously developing the tertiary industry is not only the need to promote sustainable economic development, but also the main way to achieve full employment, the biggest livelihood problem. 1.5 Uneven development between urban and rural areas and regions. Since the reform and opening up, both the eastern coastal areas and the vast inland areas have achieved rapid economic development, and the development of regional economy has made great contributions to the sustained and rapid growth of the national economy. However, Problems such as market segmentation, local protection, similar industrial structure and disorderly competition among regions formed in the process of development have never been well solved, especially the economic and social development between urban and rural areas and regions is still unbalanced. According to the 26 Annual Report on Residents' Income Distribution in China issued by the National Development and Reform Commission in February 27, in 25, the income gap between eastern China, central China and western China increased by 462 yuan and 545 yuan respectively compared with 24. At the same time, the "urban-rural income gap" within each region is larger than that of 5 yuan in the previous year; The per capita income of rural residents in China is less than 1/3 of the per capita disposable income of urban residents. China is even called the country with the fastest development of inequality in the world, and the reform has been unable to generally improve the "income" of all groups. The 25 Human Development Report published by the United Nations Development Programme describes the regional disparity and the gap between the rich and the poor in China. According to the National Bureau of Statistics, the richest 1% of the mainland population accounts for 45% of the national wealth; The poorest 1% of the population has only 1.4% of the wealth; 6% of the bank's deposits are in the hands of 1% depositors. All these show that the fruits of China's rapid economic growth over the years have not been enjoyed by all social strata, but gathered in the hands of a few people. ① The income gap between residents in China is too large, and a large number of residents belong to low-income or middle-low income classes, which is the root cause of the low proportion of household consumption in China's GDP. This is directly related to the imperfection of China's social security system, personal income tax and property tax system, and the lack of full play of redistribution. For example, China's individual income tax adopts a classified income tax system, which does not comprehensively consider the actual burden of households' population, livelihood, health status and education expenditure, and the tax burden is unfairly distributed. 1.6 The sound and rapid economic development cannot be achieved without high-quality workers, who are the main force to promote the transformation of economic development mode. Education investment is the main way to form and accumulate human capital. Education should not only impart scientific knowledge and skills, but also strengthen the education of working attitude and professional ethics, providing talent base and intellectual support for economic development and transformation of economic development mode. At present, China's low investment in scientific and technological talents, education and research and development has seriously affected the improvement of scientific and technological level and labor quality, thus restricting the transformation of economic growth mode. For example, from the perspective of education, in 27, the proportion of education investment in developing countries in GDP was above 4% on average, while that in China was only 1.32%. China's "Eleventh Five-Year Plan" puts forward the goal of "fiscal education expenditure accounts for 4% of GDP" around 21. India, also a developing country with a large population, although its economic development level is not as good as China's (according to the statistics of the World Bank, in 27, China's per capita national income was US$ 2,36, while India only had US$ 95), India had already achieved this goal as early as 2, and made ambitious efforts to achieve the average of 5% in OECD countries. Therefore, although our government attaches great importance to education, the growth rate of education expenditure is higher than the average growth rate of fiscal expenditure, but the proportion of fiscal revenue to GDP is too low, so the proportion of education investment to GDP is too low, which will inevitably restrict the development of education. At the same time, China has a large labor force, but the overall quality of the labor force is not high. The research results provided by UNESCO show that there is a high positive correlation between productivity and the education level of workers. Compared with illiteracy, primary school graduates can improve their productivity by 43%, junior high school students by 18% and college students by 3%. Therefore, China's human capital resources are relatively scarce, and the level of higher education and vocational education in China needs to be improved urgently. 1.7 Compared with innovative countries, China's enterprises' independent innovation ability is still weak, and the lack of independent brands is serious. There is still a big gap between China and major industrialized countries. Lack of independent innovation ability will not provide strong impetus for China's economic development, and will cause the country's innovation status to decline. According to CCTV reports, China ranked 33rd in "global competitiveness" in 22-23, and 46th in 24-25. The main reasons for the weak independent innovation ability of Chinese enterprises are insufficient investment in R&D, shortage of scientific and technological talents, failure to establish the main position of technological innovation of enterprises, and failure to give full play to the due function of tax policy in promoting independent innovation. China's current tax system to encourage independent innovation is not perfect, the tax policy objectives are unclear, lack of systematicness, and tax preferences benefit unevenly. For example, there is a lack of inclination in the field of scientific and technological development supported and encouraged by preferential tax policies, and the objectives in how to coordinate the development of basic theoretical research and applied technology research, develop high-tech and reform traditional technologies are not clear; The current preferential policies have benefited the recipients of scientific and technological achievements more, while scientific research units and scientific and technological workers have benefited less. China's preferential tax policies for independent innovation are mainly preferential after the event, lacking prior encouragement and support. For example, China's current tax incentives for high-tech industries focus on the downstream of the industrial chain, which plays an important role in the formation and scale of high-tech industries, but due to the lack of incentives for the upstream of the industrial chain.