Studies on the Financial and Economic Effects and Improving Measures of China's Transformation from Business Tax to VAT

DOI

10.2991/icesame-17.2017.338How to use a DOI?

Keywords

Transformation from business tax to VAT, Financial and economic effect, Taxation system reform

Abstract

The business tax is a kind of tax collected by total business turnover derived from the provision of taxable services, the transfer of intangible assets and the sale of immovable property in China, while the value-added tax (VAT) is a kind of turnover tax levied on the increase in the value of goods in production and circulation and the provision of labor services. China's "Transformation from business tax to VAT" is a taxation reform policy, whose essence is to enlarge the range of levying VAT and bring the original industries that pay business tax under the range of levying VAT. It started trial in Shanghai's six service industries since January 1, 2012, and began to implement in all service industries in the nationwide since May 1, 2016. On the one hand, we can see that "Transformation from business tax to VAT" is an important content of China's taxation reform, which has a significant impact on reducing VAT taxation burden of enterprises, reducing fiscal revenue, promoting economic growth, adjusting industrial structure and other aspects. On the other hand, there are difficulties like taxpayer identity selection, tax rate selection, the scope of input tax which can be deducted, and the VAT income distribution between central and local and so on, in the pilot process. This paper analyzed the financial and economic effect of "Transformation from business tax to VAT", and put forward some countermeasures in view of the practical problems arising from the pilot process, so as to perfect the implementation of China's "Transformation from business tax to VAT" and sum up advanced experience for China's follow-up taxation system reform as well as other countries that are committed to reform their taxation system.

Copyright

© 2017, the Authors. Published by Atlantis Press.

Open Access

This is an open access article distributed under the CC BY-NC license (http://creativecommons.org/licenses/by-nc/4.0/).

Download article (PDF)

TY  - CONF
AU  - Yun Li
PY  - 2017/06
DA  - 2017/06
TI  - Studies on the Financial and Economic Effects and Improving Measures of China's Transformation from Business Tax to VAT
BT  - Proceedings of the 2017 2nd International Conference on Education, Sports, Arts and Management Engineering (ICESAME 2017)
PB  - Atlantis Press
SP  - 1587
EP  - 1590
SN  - 2352-5398
UR  - https://doi.org/10.2991/icesame-17.2017.338
DO  - 10.2991/icesame-17.2017.338
ID  - Li2017/06
ER  -