arbiter
JournalsAccount

Tax Enforcement Digitalisation and Corporate Employment: Evidence From China's Golden Tax Project III

Lifang Chen et al.

Accounting and Finance2026https://doi.org/10.1111/acfi.70199article
AJG 2ABDC A
Weight
0.50

Abstract

We examine the impact of tax enforcement digitalisation on corporate employment by exploiting the quasi‐natural experiment of the Golden Tax Project III (GTP III) in China. Our findings reveal that the implementation of GTP III results in a 3.9% decrease in corporate employment. Moreover, we find that GTP III crowds out labour demand by increasing precautionary cash holdings and decreasing fixed asset investment in response to heightened tax‐related uncertainty. From a structural perspective, GTP III reduces employment for individuals without a graduate degree and for employees in non‐R&D and non‐technical departments, and generally alleviates over‐employment. These findings suggest that digital tax enforcement, while improving tax administration, generates unintended labour market frictions, reducing overall employment but optimising firms' human capital structure. Our study expands the research on the microeconomic effects of digital tax enforcement and emphasises the importance of considering short‐term employment pressures when promoting public policy digitalisation.

Open via your library →

Cite this paper

https://doi.org/https://doi.org/10.1111/acfi.70199

Or copy a formatted citation

@article{lifang2026,
  title        = {{Tax Enforcement Digitalisation and Corporate Employment: Evidence From China's Golden Tax Project III}},
  author       = {Lifang Chen et al.},
  journal      = {Accounting and Finance},
  year         = {2026},
  doi          = {https://doi.org/https://doi.org/10.1111/acfi.70199},
}

Paste directly into BibTeX, Zotero, or your reference manager.

Flag this paper

Tax Enforcement Digitalisation and Corporate Employment: Evidence From China's Golden Tax Project III

Flags are reviewed by the Arbiter methodology team within 5 business days.

Evidence weight

0.50

Balanced mode · F 0.40 / M 0.15 / V 0.05 / R 0.40

F · citation impact0.50 × 0.4 = 0.20
M · momentum0.50 × 0.15 = 0.07
V · venue signal0.50 × 0.05 = 0.03
R · text relevance †0.50 × 0.4 = 0.20

† Text relevance is estimated at 0.50 on the detail page — for your query’s actual relevance score, open this paper from a search result.