Tax sharing is a common practice in market economy countries. Market competition requires financial resources to be relatively dispersed, and macro-control requires financial resources to be relatively concentrated. The relationship between centralization and decentralization is reflected in the financial management system, which is the relationship between centralization and decentralization of the central government and local governments.
Historically, every country has encountered this problem in the process of its market economy development, and it has been repeatedly discussed and practiced; Judging from the current situation, no matter what form the market economy countries take, they generally adopt the tax-sharing method to solve the problem of centralization and decentralization.
The tax-sharing system is a financial management system that divides the central and local revenue sources according to tax categories. To implement the tax-sharing system, it is required to realize "three points" according to tax types: decentralization, tax-sharing system and tax management. Therefore, the tax-sharing system is essentially a financial management system formed by dividing taxes into central taxes and local taxes (sometimes including * * * taxes) in order to effectively handle the relationship between the central government and local governments in terms of affairs and financial rights.