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Research Details

Technological Adoption and Taxation: The Case of China’s Golden Tax Reform, NBER Tax Policy and the Economy

Abstract

This paper investigates the effect of Phase 2 of the Golden Tax Project on VAT in China. The reform introduced computer-generated invoices and electronic transaction linking. Using a difference-in-differences strategy, we show that the reform increased VAT by reducing exaggerated VAT deductions. The introduction of the new digital technology had large positive effects on Chinese fiscal capacity. VAT gains from the reform explain approximately 13.7% of VAT growth during 1998 to 2007.

Type

Article

Author(s)

Nancy Qian, Jaya Wen, Liu Yu

Date Published

2024

Citations

Qian, Nancy, Jaya Wen, and Liu Yu. 2024. Technological Adoption and Taxation: The Case of China’s Golden Tax Reform. NBER Tax Policy and the Economy.

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