Value-Added Tax Sharing, Financial Incentives and Tax Burden Stickiness of Manufacturing Enterprises

The fiscal relations between governments are mainly characterized by tax sharing and power division. It is of great significance to explore the factors affecting the stickiness of enterprise tax burden from the perspective of tax sharing for relieving the pain of tax burden of manufacturing enterprises. Based on the “50/50 sharing” reform of VAT in 2016, this paper constructs an intensity DID model and takes China’s A-share manufacturing listed companies from 2012 to 2022 as research samples to empirically test the impact of VAT sharing on the stickiness of corporate tax burden and its mechanism. It is found that the increase of local tax sharing ratio simultaneously produces the effect of tax collection and administration strengthening and financial assistance, and will eventually ease the stickiness of corporate tax burden, and this effect is more obvious in regions with less financial pressure, foreign-funded enterprises and enterprises with high tax compliance.