Abstract:

In this study, our attention is directed toward examining the impact of information-based tax administration on revenue budget deviation. We employ the adoption of the“Golden Tax III" project as a proxy for information–based tax administration reform, treating it as a quasi-natural experiment. We find that the reform reduced the deviation of the fiscal revenue budget by using data from administrative units at the prefectural level in China from 2011 to 2016. This effect is mainly propelled by the tax types newly covered by the project and is particularly evident in areas with high Internet penetration and serious fiscal irregularities of local governments. Mechanism analysis reveals that the primary factor contributing to the reduction in budget deviation is the enhancement of budget execution capacity. On the one hand, the reform alleviated the adverse impact on budget management in the non-budget periods. On the other hand, it stabilized the fluctuation of budget execution and created a more equitable tax environment for businesses. This study provides practical suggestions for promoting the implementation of modern budget management driven by informatization.

Key words:

fiscal revenue budget deviation, informatization, “Golden Tax III” project