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ABSTRACT
How can investment be stimulated under the premise of stable taxation? Based on some Chinese listed companies, we examine the impact of soft taxation on corporate investment. Companies that obtain an A tax credit rating have more actual investment now and in the future under soft tax administration, and this policy also effectively mitigates companies’ underinvestment problem. This paper shows that incentive tax policies can achieve a win–win situation between national tax revenues and company investment expenditures.
Disclosure statement
No potential conflict of interest was reported by the author(s).
Correction Statement
This article has been republished with minor changes. These changes do not impact the academic content of the article.
Additional information
Funding
This work supported by ‘the Fundamental Research Funds for the Central Universities’, Zhongnan University of Economics and Law [202211104].