  The paper Tax Incentives, Rent Sharing and Within-firm Wage Inequality by IIDPF Professor Zhang Kezhong and his co-authors was officially published in the top journal Economic Research Journal 2021, No. 6. The study combines the background of the impact of China's accelerated depreciation policy on fixed assets on corporate tax liabilities in 2014, focusing on the impact of tax incentives on intra-firm income inequality and its underlying mechanisms, in an attempt to provide new insights into the use of corporate tax to regulate income distribution and promote social equity in China.
  Results of the study have shown that: (1) the tax benefits of accelerated depreciation policies significantly increased the average wages of corporate management but did not significantly change the average wages of ordinary employees, thereby widening intra-firm income inequality. (2) Tax incentives mainly improved corporate productivity and operating performance by promoting corporate capital investment and increased the rents shared by firms with their employees, but management shared rents to a greater extent compared with ordinary employees, thus widening intra-firm income inequality; (3) Results of the heterogeneity analysis showed that tax incentives had a greater impact on intra-firm income inequality for private firms with long-term asset structures and smaller are greater, but employee bargaining power can retain the impact of tax incentives on intra-firm income inequality.
  The study has come up with the following three policy implications: (1) In the process of using tax policy to regulate the income distribution of residents, it is important to consider not only the personal income tax of residents, but also the impact of corporate tax on income distribution; (2) In the construction of the corporate governance structure, the power of employees should be further enhanced and their supervision and management of the company should be increased; the difference in the response to tax concessions due to income inequality within enterprises with different property rights also verifies the effectiveness of the "salary limit order" for executives of SOEs; (3) Corporate managers should further optimise their company's remuneration system in order to reduce the negative impact of income inequality on the company's development as a result of the new round of tax cuts in the future.
  This research is a major achievement of professor Zhang Kezhong's general project of the National Social Science Foundation of China entitled Research on the Labour Market Redistribution Effect of Social Insurance System Reform (Project Approval No. 20BJY058) and the IIDPF Programme for the Introduction of Innovation and Wisdom in Higher Education (Project Approval No. B20084).