Abstract: Tax administrative adjudication in People’s Republic of China (PRC) presents a persistent puzzle: courts exhibit deference in technically complex cases, yet demonstrate relatively strict scrutiny in high-stakes disputes involving substantial revenue. While normative theories often attribute judicial behavior to statutory mandates or political obedience, few studies have addressed the underlying economic rationality driving these divergent outcomes. Learning from theories regarding institutional competence and judicial behavior, this paper develops Judge’s Utility Function Model (UJ = αL − βC + γP) to address the equilibrium of judicial decision-making in tax cases. This paper analyzes 391 tax administrative judgments from 2020 to 2025 using binary logistic regression to demonstrate a dual‑track mechanism in judicial review. Under this model, cost‑minimization in complex factual disputes leads to rational deference, while risk‑aversion in high‑stakes cases drives strict scrutiny to prevent serious errors. Given that tax justice emerges largely as a by‑product of utility maximization under institutional constraints, reforms should focus on reshaping adjudication’s cost‑benefit structure. Practical measures may include improving specialized tribunals, clarifying review standards, and introducing penetrative review, which would help stabilize judicial expectations.