Abstract: Using a sample of unlisted companies from the 2007–2020 stock market, this study validates the association between tax reduction, rate reduction, digitization, model modification, and total element productivity. The study found that (1) Tax cut and rate reduction policy greatly increases the company's total element productivity. (2) Conversion of digitization encourages high-quality development through the resource optimization effect and technological energy supply. (3) Digitization conversion had the strengthening effect on the tax cut and rate reduction policy, and the total element productivity increased by 7.75% by the synergistic effect of both. Heterogeneity analysis shows that synergistic effects of non national and high-tech industries and low competitive markets are more pronounced. According to the verification of the mechanism, the tax reduction and the rate reduction are promoting quality development through the relaxation of the loan constraint, the promotion of the innovative investment, and the expansion of the scale economy.

Keywords: tax reduction, fee reduction, high quality development, digital transformation, enterprise, total factor productivity

Pages: 171-179