Impact of the policy of replacing business tax with value-added tax on the operating behavior and performance of listed manufacturing companies


CHEN Zhao;LIU Yingman


School of Economics and Trade, Guangdong University of Foreign Studies;School of Economics and Trade, Guangdong University of Foreign Studies


The replacing business tax with value-added tax reform is another important fiscal and tax policy after China’s tax-sharing reform. Its impact on the market economy has also significantly influenced the manufacturing industry. This paper uses the micro-data of listed companies in the manufacturing industry from 2009 to 2014, uses the difference-in-differences method and evaluates the policy effect on the operating behavior and performance of manufacturing enterprises. Firstly, the research shows that the policy has a significantly negative impact on the R&D behavior and the fixed assets expansion of manufacturing enterprises. It also has a negative impact on the financial performance but a positive effect on the expected performance of enterprises. We prove that the above conclusions are reliable through four robustness tests. Secondly, the policy has heterogeneous effects among enterprises. The policy causes distinguished changes of behavior and performance of the enterprises differing in ownership, product diversity, product quality and age. Therefore, further optimizing the VAT collection and management and formulating a differentiated taxation system according to industry characteristics will not only help to improve the business performance of enterprises, but also facilitate the transformation and upgrading of enterprises.


replacing business tax with value-added tax;manufacturing;heterogeneity;R&D;performance


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Total: 17 articles

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