Evaluation of the Impact of Digital Economy on Tax Revenue and Tax Source Suitability

Grounding on the theoretical underpinnings linking the digital economy and tax deviation, an assessment framework is devised. Subsequently, via the two-way fixed-effects model regression, leveraging the balanced panel data of 41 cities in the Yangtze River Delta region spanning from 2011 to 2021, the ensuing conclusions are derived: (i) A notable augmentation in the development level of the digital economy can markedly hasten the magnitude of tax deviation. These findings endure even after subjecting them to a series of robustness assays, exemplified by techniques such as shrinking the tail and incorporating lags for the pivotal explanatory variables within the sample data. After shrinking the sample data and lagging the core explanatory variables by two periods, the conclusion still holds; (ii) Compared with Anhui Province and Jiangsu Province, the increase in the level of the digital economy accelerates the degree of tax deviation of tax revenue sources in Zhejiang Province and Shanghai Municipality more significantly. Since 2015, the digital economy has progressively ascended to the status of a national strategy, propelling China into a novel phase of digital economic development., but due to the influence of tax collection rules and policy adjustment lag, the improvement of the digital economy development after 2015 has not significantly improved the acceleration of the tax source deviation in the Yangtze River Delta region.(iii) The rationalization degree of the industrial structure can markedly mitigate the influence exerted by the digital economy on the tax source deviation degree. In light of the foregoing analysis, this thesis proceeds to put forward four countermeasure proposals from the vantage point of the integration of the Yangtze River Delta (YRD).