TAF PUBLISHING

Economic implications on government incentives to industries are key areas that require critical analysis in understanding the impacts. Tax incentives are the most predominant approach used in most cases in reducing various related costs. This paper aims to reveal the impact created by the government incentives on IT-related Hi-tech companies. This research uses the government annual survey data on Chinese listed corporations in Hebei province to investigate the incentives-related parameters. Data from a survey of 85 Information Technology (IT) related industries in Hebei province showed a significant positive impact of company’s incentives role, the incentives given by the government increase output in industries. This study also examined the role that the government incentives played concerning high-tech related industries Using multiple regression analysis methods, the results indicated that related Hi-tech company’s incentives created a significant impact in increasing the gross value of industrial output, impacting both product sales income and the commodity sales revenue. However, the results indicated that not all the government IT-related Hi-tech company’s incentives led to improved total income between the study periods. Moreover, there would be an anticipated increase in employee rate if these incentives were constantly provided to Hi-tech companies consistently, but there was no clear increase in personnel over that period in totality. Therefore, this study provided room for discussion and further studies that would help in coming up with other concrete evidence in subsequent years.