Abstract: This paper uses the national tax survey data of manufacturing and information services in 2013-2015 to investigate the impact of VAT on enterprise tax burden, sales revenue and innovation input with fixed effect model. The results show that VAT incentives lead to a significant increase in the income tax burden and the actual total tax burden of the general taxpayer, but it will significantly reduce the total actual tax burden for small-scale taxpayers;preferential VAT general taxpayer sales revenue decreased significantly, but increased sales income of small scale taxpayers;the preferential tax increase innovation investment enterprises in the East, but enterprise income tax inhibits innovation investment enterprises in the East; the tax burden of the eastern enterprises is higher than that of the central and western enterprises, but it attracts more innovative investment than the Midwest enterprises. Therefore, we should expand the coverage of VAT, enlarge the object of value added tax preference, deduct the scope of the project, and considerate efficiency and fairness, to reduce enterprises value added tax burden in the East, and let the western local governments have more value added tax into proportion, so as to increase innovation investment and narrow regional differences.

Key words: value added tax preference;enterprise tax burden, sales income, innovation inputs