The Present Situation and Future Path Choice of China's Tax Reduction Policy —— Based on AD-AS Model

Abstract

Tax reduction and fee reduction, that is, reducing tax burden and rate, will stimulate taxpayers' production and consumption, promote economic growth and expand tax base, and form a virtuous circle. Based on the present and looking forward to the long-term, the Chinese government has issued a series of tax reduction and fee reduction policies in view of the actual situation that domestic enterprises are facing high costs and thin profits and fierce international competition, and the local implementation of tax reduction and fee reduction policies has a direct impact on local economic development. This paper analyzes the scale and structure of tax reduction and fee reduction in China at present, combs the basic logic of tax reduction and fee reduction with AD-AS model, and analyzes the reasons for the continued implementation of tax reduction and fee reduction policy in the future based on the current situation of tax reduction and fee reduction in China in recent years.