Research on the Trend of Global Fiscal and Tax Policies Under the Pandemic and its Enlightenments for China

Abstract

In recent years, major uncertain events have occurred frequently all over the world. In particular, the outbreak of COVID-19 in early 2020 has posed a great threat to the health and economic aspects of human society. The pandemic has a wide range of influence, strong infectivity, and long duration, even today, the virus is still spreading and mutating all over the world. Governments of all infected countries have introduced pandemic response plans at the very early beginning to minimize the loss of the pandemic as much as possible. Fiscal and tax policies, as an integral part of those plans, play an irreplaceable role in the counter cyclical regulation of macro-economy and the behavioral impact of microeconomic subjects. The impact of the pandemic on mankind is profound. Even if the pandemic has passed, we are still in a high-risk society. For a long time in the future, this high degree of uncertainty will always accompany mankind. In this paper, the fiscal and tax policies of various countries to deal with the pandemic are divided into fiscal subsidies and preferential tax, combined with the policies implemented by various countries, which made a comparative analysis. As the country that first discovered and reported to the World Health Organization, China has been the most severely and long-term hit in the face of this major crisis. Therefore, based on summarizing the experience of related policies in various countries, this paper analyzes the role of fiscal and tax policies from the three stages of outbreak, stability, and recovery of the epidemic through bibliometric analysis, content analysis of relevant literature, proposed that the Chinese government should make a transition from short-term emergency policy to long-term stimulus policy, adjust the tax structure, increase taxes, promote international tax cooperation and coordination, and improve the emergency fiscal and tax system to deal with the crisis and help China's economy get back on track. Through combing the tax practice experience of various countries, this paper believes that in the post epidemic era, the global economic level of fiscal stimulus will not decline on a large scale. At the same time, this paper provides its own recommendations and solutions that is structural tax cuts will become a trend for countries to deal with the crisis. However, in view of the increasing fiscal pressure, the total tax reduction will not become the mainstream, and put forward corresponding suggestions and solutions on how to better use fiscal and tax policies in China to cope with the challenges brought by the great changes in economic diplomacy and the natural environment.