This paper firstly analyzes the impact and mechanism of tax incentives on corporate financing, innovation investment and innovation output. Secondly, 1311 observations were selected from A-share listed companies as samples, and the propensity score matching method was used to empirically test the net effect of tax incentives on enterprise innovation. Thirdly, it uses linear regression model to analyze the factors affecting the level of innovation of enterprises. The results show that tax incentives have no significant effect on corporate financing and innovation output, but they have a significant role in promoting corporate innovation investment. And the scope of current policy is accurate and efficient. If the preferential treatment spreads to more enterprises, it can also promote its innovation investment to a certain extent, but the average promotion efficiency of preferential policies will be significantly reduced. Finally, it proposes policy recommendations to promote the innovation vitality of enterprises from the aspects of stimulating external innovation investment, perfecting personnel training preferential policies and tracking and evaluation of policies later.