Revenue-based Perspective of the Fiscal Relationship between Central and Local Governments

Based on fiscal revenue perspective,this thesis reviewed fiscal reform history in China,pointing the constitutional background,ideology and disposable financial resources for local governments could be dominant facts on the fiscal decentralization.Tax-sharing reform was just the re-distribution of budget financial resources,which provided the discipline of intergovernmental budget revenue distribution.Since 1994,Tax-sharing reform has continued,tax-sharing of central and local governments constantly changing.Central government's preference was fiscal re-decentralization,expanding the scope of taxes-sharing,increasing more tax and financial revenue.Tax-sharing reform did not required local governments' expenditures,which substantially empowered local governments' financial control.Therefore,under these pressure,local governments had been facing a soft budget constraint,they could increase the other fiscal revenue to balance their budget,by improving the non-tax revenue scales,or asking for more fiscal transfers from central government ect.Moreover,local governments had increased fiscal disposable income and promoted economic growth,which were reasons for the expansion of local non-tax revenue.