یک ارزیابی از اصلاح مالیاتی سال 1994 در چین با استفاده از یک مدل تعادل عمومی

This paper applies a computable general equilibrium model to analyze the effects of the 1994 tax reform in China. The result of the simulations shows that small aggregate welfare gains are obtained from the 1994 tax reform. However, household groups are worse off because of the redistribution of resources from household to government sectors. There will be a substantial increase in the government revenue and the prudent and productive use of the increased revenue could improve the welfare of the households. This result also suggests that the statutory rates introduced in 1994 may be too high from the equal yield standpoint. It is suggested that further improvements in the tax system can be made by extending a consumption-type VAT to other sectors currently not included in the reform.

In 1994 China implemented an extensive reform of its tax system with the objective of promoting a market-oriented economic development. This reform mainly involves the transition from turnover taxes to value-added taxes and the integration of income tax rates for different types of enterprises. This paper provides a quantitative assessment of the economic consequences of the 1994 tax reform. To this end, we adopt a computable general equilibrium (CGE) approach. In contrast to the partial equilibrium approach, which is usually used to make assessment of the impacts of taxes, the CGE model has the main advantage of combining detailed and consistent real-world databases with a theoretically sound framework (Shoven & Whalley, 1972)1. It captures the interactions among different sectors and agents, and these are important for analyzing the incidence, distributional and welfare implications of the tax policy changes. We also attempt to explore alternative measures that can be added to the 1994 reform package, which may improve the efficacy of the tax system. The rest of the paper is organized as follows. Section 2 outlines the weakness of the pre-reform tax system and the tax changes introduced in the 1994 reform. Section 3 presents the salient features of the CGE tax model for China. Section 4 discusses the data used for model calibration, and 5 and 6 present our results of a number of tax reform simulations. Section 7 concludes the paper.

In this paper, a CGE model of the Chinese economy is developed to provide a numerical appraisal of the effects from the 1994 tax reform and some alternative tax policies. The analysis was done by two sets of simulations. The first set looks at the impact from the tax changes introduced in the 1994 reform. The statutory rates in the 1994 plan are used as new effective tax rates in the calculation of counterfactual equilibrium. The result of the simulations shows that small aggregate welfare gains are obtained from the 1994 tax reform, however, household groups are worse off because of the redistribution of resources from households to government. Income distribution among households will deteriorate, though the extent will be marginal. There will be a substantial increase in the government revenue and the prudent and productive use of the revenue can help to improve the welfare of the households. A separate set of simulations were made to evaluate the impact of some alternative tax policies. Two proposals for value-added tax are examined and the results show that extension of the VAT or adoption of a consumption-type VAT is worth considering in future reform as long as the government can deal with the inflation and administrative problems. The result also suggests that the statutory rates introduced in 1994 may be too high from the equal yield standpoint. In particular, the rate of 17% for the existing income-type VAT seems more reasonable for a consumption-type VAT.