The Analysis of the Conversion of New and Old Kinetic Energy in Third-tier Cities from the Perspective of New Taxes: Taking City A as an Example

Abstract

The economic adjustment function of taxation has played an important role in promoting the China’s conversion of new and old kinetic energy of enterprises. This study based on precious first-hand quarterly data of more than a hundred key tax source companies in City A from 2015 to the first quarter of 2018. The results show that government tax incentives and strengthened supervision have significantly promote the innovation level of enterprises; after the "replacing the business tax with a value-added tax", high labor costs of modern service hinder the speed of new and old kinetic energy conversion.