On The System Structure Of The Modern Tax Law

The primary goal of this dissertation is to fully understand the structure of modern tax law. Historically, or between nations, there exist many differences of tax system. Only positive analysis is not enough for interpreting the structure of modern tax law. We need to penetrate into the fundamentals (or basic principles) which sustaining the system structure of modern tax law, to explain the system structure how to be formed and to clarify it' development trend. The fundamental of modern tax law involves technological and axiomatic basic principle. Technological principle represents instrumental rationality and axiomatic principle represents value rationality existing in tax law. The theory of modern tax law wants to discuss, in terms of ontology, tax justice such as the principle of taxing in accordance with statute-the formal justice of the tax-and principle of tax fairness-the substantive justice of the tax, so intentionally refuse and look down to the instrumental rationality existing in tax law. But tax law is substantive law, it' all rules and systems have their direct goal, include basic revenue purpose, and economic interference purpose such as wealth redistribution, correct the externality of economic activities, macroeconomic regulation and so on, so it certainly demand all rules and systems are effectiveness to the legislative purpose of the tax. This is the instrumental rationality existing in tax law; it is decided by the substantive goals of tax legislation; it is the problem of whether the rules and systems as means are effectiveness to the goals. The essence of substantive law of tax law decides that technological principle is significant principle in the system construction of modern tax law. Technological principle decides means are whether effectiveness to goal, indicates the objective connection between things, and is the things science judgment, not value judgment. Technological principle based on objective fact, is associated with reality of society. But technological principle can not make the tax law justification; justification comes from axiomatic principle, so axiomatic principle is also significant principle in the system construction of modern tax law. Axiomatic principle is related to value judgment. The relationship between technological principle and axiomatic principle may be viewed as that technological principle is the bottom principle of the modern tax law, and axiomatic principle is based on the technological principle. The theory of modern tax law which only discusses tax justice in terms of ontology is distorted and incomplete.The system structure of modern tax law is based on corresponding social foundation and some basic conceptions. Chapter one is beginning with analyzing the social foundation of the tax system of ancient agricultural society, with the purpose of, by historical comparison, making it clear that social reality is crucial to the construction of tax system, and the developing tendency of the tax system. The ancient tax system based on agricultural society, main part is land tax, companion with levying manual product and labor in line with population. As productivity grows, capitation tax is gradually merged into land tax. The modern tax system is based on modern industrial society and market economy. It' significant parts are income tax and VAT. It' goals developed, from simply revenue purpose to the purpose of economic interference. Modern economics and philosophy of rationalism and humanism as well as the thoughts about rule of law becomes basic concept of modern tax law.Tax law is substantive law, all the rules and systems have it'direct goal. The rules and systems are nothing but the means to achieve the intended destination. So it is necessary to consider the effectiveness of the means for the purpose when we construct our whole tax system. This is the technological principle or instrumental principle existing in the tax law. It demands the function of the tax system is coordinated with each other. Using structural and functional analysis method is necessary to clarify the technological principle in the system construction of modern tax law. To achieve the revenue purpose and the economic interference purpose, modern tax law structurally develops to two significant parts: substantive tax law and procedural tax law which respectively have it' specific function. Chapter two will analyze the system structure and it' function of the substantive tax law. The main function of substantive tax law is to decide under what conditions the tax liability comes into being. The system structure of the substantive tax law include conditions which make the tax liability (or tax debt) being existence, namely the constitutive requirements of tax. These conditions include taxpayer, tax object, the attribution of the tax object, tax basis and tax rate. This chapter will analyze the significant of such conditions as constitutive requirements of tax. In addition, the substantive tax law logically includes the system of tax inheritance and tax concession as well as punitive system. All of these systems have their specific function or significance in achieving the revenue purpose and economic interference purpose of modern tax law.Chapter three will analyze the economic substance doctrine of tax law. The economic substance doctrine represents the technological principle rather than axiomatic principle existing in tax law. The economic substance doctrine is derived from the revenue purpose of the tax. It indicate that, the tax law should capture the economic source of taxation by the words be used then make it as the tax object, make the person to whom the interest of the tax object belongs as the taxpayer, the cause in fact from which the tax object derived does not affect tax. The economic substance doctrine demands, interpretation of tax law should be in accordance with it'economic substance rather than it'form. The economic substance doctrine has anti-tax avoidance function strongly. But the economic substance doctrine is possibly letting the constitutive requirements become a mere formality, so should limited by the principle of no taxation without law. The economic substance doctrine is not only the basic principle of the system construction of substantive tax law, not only the basic principle of tax law interpretation, but also the basic principle of fact judgment, that is, necessary to consider the economic significance of the fact (or evidence), so should also apply to the procedural tax law.In modern industrial society, there exists a phenomenon of serious asymmetry about the information of the tax constitutive requirements fact between the tax authorities and the taxpayer. This phenomenon gives rise to the emergence of the procedural tax law. The basic function of the procedural tax law is to decide the fact, to decide the tax amount and to realize the tax. Chapter four will make it clear that the taxpayer's information reporting liability through mainly tax returns filing, and the tax authorities'investigation power which aimed at collecting the tax constitutive requirements fact, all these arise from the demand to decide the fact. The general tax procedure of modern tax law may be divided into two models:the self-reporting tax procedure and power-based tax procedure, both of it include the procedural steps such as tax declaration, decision of tax amount, tax payment, and compulsory enforcement. In the self-reporting tax procedure the taxpayer has some autonomy, so the tax returns have legal effect to decide the tax amount. The power-based tax procedure is controlled mainly by tax authorities. The special tax procedures of modern tax law include withholding at source and revenue stamp payment method. Because the taxpayer's declaration liability is exempted, so the special tax procedure is simplified procedure. During the tax liability to be performed, or at the time which is after the tax liability being existent and previous to it being nonexistent, to prevent the government's tax interest from being harmed by taxpayer's act, the modern procedural tax law stipulate for some systems in to safeguard the government's tax interest.Technological principle does not give the tax law justification, so it should be filtered by axiomatic principle. Axiomatic principle represents value rationality existing in tax law. One of the axiomatic principles is the one about the formal principle of tax justice, the principle of no taxation without law. The principle of no taxation without law reflects the thoughts about rule of law. Chapter five will analyze the content of that principle and the other question related to it as well as the puzzles caused by that principle in modern society.The other one of the axiomatic principle is the one about the substantial principle of tax justice, the principle of tax equity. This principle comes from the equity principle of constitution. The principle's core content is to distribute tax burden in accordance with everyone's economic ability to pay tax, namely, ability to pay principle. Chapter six deem that, tax equity is not certainly embodying in ability to pay principle, it more probable requires tax in accordance with form, tax equitably based on abstract personality. The ability to pay principle embodies initially the technological economic substance doctrine and the social ideal of wealth redistribution, and then embodies the requirement of tax equity. In fact, modern tax fairness thoughts cater to the requirement of economic substance doctrine and wealth redistribution. The ability to pay principle requires distribution tax burden in accordance with current occurring fact which indicating taxpayer's economic ability to pay, rather than prospective fact.Efficiency is one of the values to which the system construction of modern tax law pursued. Chapter seven will analyze the axiomatic principle of tax efficiency. Tax efficiency includes tax economic efficiency and tax procedural efficiency. In the early days, tax economic efficiency referred to it should be to minimize the loss of the market efficiency which arises from taxation. At the present times, tax economic efficiency also refers to enhance the efficiency of the whole economy through correcting the market failure by institutional arrangement of tax. The institutional arrangement of tax can enhance the efficiency of the whole economy through correcting the externality of the economic activities, urging reasonable exploitation of the natural resources, opposing illicit competition in international trade, and macroeconomic regulation. Chapter seven will analyze the economic interference purpose of the modern tax law and its legal realization mechanism. Traditional legal thoughts viewed that efficiency technological and non-metaphysical, that to enhance the efficiency of the whole economy through the government's economic interference will lead to restriction of the personal freedom, so the theory of the modern tax law generally does not view efficiency as the basic principle of the system construction of the modern tax law. But undoubtedly it is a fact that modern tax law is widely used to economic interference purpose. The problem will not be nonexistent only because we ignore it. We should view efficiency as an independent value of the modern tax law. Tax procedural efficiency refers to realizing tax at minimal costs. All the system constructions, both procedural tax law and substantive tax law, are related to efficiency.In summary, the system structure of modern tax law is based on some basic principles. These basic principles are the cause in forming the system structure of the modern tax law, indicate its developing trend. These basic principles include technological and axiomatic principle. Technological principle represents instrumental rationality and axiomatic principle represents value rationality existing in the tax law. Technological principle is decided by the essence of substantial law of the tax law. It is quite not enough that the theory of modern tax law only discuss the taw justice in terms of ontology.