지방교부세가 지방정부지출에 미치는 영향: 세수 감소 요인의 조절효과로 인한 끈끈이 효과의 발견

The problem facing the finances of local governments in Korea is that they are unable to practice own-source revenues because the scale of intergovernmental transfer is larger than that of their own. This can be fixed by increasing local tax revenue, but there is no effective management of local tax arrears or tax exemption and reductions that reduce local tax revenue. Local shared tax has the potential to have a flypaper effect on local government expenditure. The existence of the flypaper effect has a problem that hinders the efficient operation of national finances and distorts the supply of public services by local governments. The purpose of this study was to demonstrate how local tax arrears and tax exemptions, which cause a decrease in local tax revenue, affect local government expenditure. In particular, it focused on examining whether the flypaper effect of the unconditional grant is strengthened by the factor of reducing local tax revenue. For the analysis, five-year panel data for local governments that were subsidized unconditional grants was constructed and the fixed effects analysis was performed. As a result, it was found that the moderating effect of the declining tax revenue factors caused the flypaper effect of the local grant tax. This suggested that local tax arrears and tax exemption and reduction need to be improved not only to secure tax revenues but also to prevent the side effects of the flypaper effect.