Abstract
This chapter investigates the changes in central-provincial fiscal relations, as the fiscal context in which education equalization is implemented, and examines the influence of the 1994 tax reform on education inequality through the changes in provincial share of revenues. Two fiscal reforms since 1978 have fundamentally changed the fiscal relationship between local governments and the center. The first was in the early 1980s, accompanied by education reform, and the second was the 1994 tax reform. The current enquiry proposes to examine the direct impact of the 1994 reform on education inequality, since the data from 1994 through 2007 are available. Section 4.1 describes the decentralization of finance and education in the 1980s. The 1994 tax reform, as fiscal recentralization, is discussed in Section 4.2. Section 4.3 maps the evolution of the fiscal relation between the center and the provinces and introduces the concept of “the fiscal dependency of the province.” Section 4.4 discusses some factors relating to education inequality but commonly confronted by all provinces, and Section 4.5 concludes the chapter.
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Lin, T. (2013). 1994 Tax Reform and Provincial Fiscal Dependency. In: The Politics of Financing Education in China. Palgrave Macmillan, London. https://doi.org/10.1057/9781137009166_4
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DOI: https://doi.org/10.1057/9781137009166_4
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