Wang Dehua: How to Analyze the Financial Contribution of Provincial Administrative Regions?

Release time:2018-01-31Author: Wang Dehua

The analysis framework of viewing the financial contribution of provincial administrative regions from the perspective of regional total financial resources: compare the total regional financial resources of the national and local tax revenues and non-tax revenues in the general public budget with the disposable financial resources left in place for local fiscal expenditures to know the contribution of each province to the national finance or how much subsidy it needs from the central government.Ranking of 31 provinces’ financial contribution since the “Twelfth Five-Year Plan”: 9 of the 31 provinces have contributed financially to the national finance, and 22 provinces require a net subsidy from the central government.How to correctly understand the financial contribution: First, a few provinces have a net contribution to the country’s financial resources, and most regions need central subsidies to maintain the operation of the public sector, which is the norm in Chinese history, and it is also the norm in countries with large regional development differences. The ranking of the financial contribution is not equal to the ranking of the contribution of each region to the country. Second, the financial contribution to the national finance or the amount of central subsidy required, and local financial constraints or debt pressure are two issues and should not be confused with each other.