Research On The Legal System Of Tax Preference To Promote SMEs In China

Small and medium-sized enterprises (SMEs) play an important role in both the national economy and the harmonious society. According to the statistical data and related information, SMEs'rapid growth can promote the scientific innovation and technological progress; as well expand the number of local employment.However, in market competition, SMEs are always in a weak position. The status of their existence has been plunged into numerous difficulties. SMEs usually have rapid develop with a low survival rate. They often face to financing difficult, for their lack of economic capabilities and low credibility. Most of them are labor-intensive industries, short of core competence. Although there are a lot of preferential policies, SMEs shoulder a heavy tax burden. The former four circumstances are the main difficulties which SMEs are faced with now. Then in 2001, China officially became a WTO member, which increased the external competitive pressure for SMEs. In addition,2008 world financial crisis resulted in many SMEs'death. All the above shows our SMEs present situation cannot catch up with the fast changing economic development. And they really need to break the backward both inside and outside.Undeniably, as one of the most effective means of the national government macroeconomic control, tax do well in easing the heavy pressure on SMEs'survival and progress, as well reducing financial expenditure and promoting national economic development. For this reason, this article will elaborate the main idea from the perspective of tax preference legal system to stimulate Chinese SMEs'growth and development.Currently, some related national laws and regulations provided the principle or instructive provisions. And in other normative documents, a large of provisions on value-added tax, business tax, and income tax is related to encouraging them. All these policies and regulations are good for safeguarding and stimulating their rise.Driven by economic progress, the SMEs have advanced rapidly and changed a lot. China's current tax system (aspects of tax preference in particular) is already lagging behind in many parts of SMEs development, no longer able to meet the needs of its rapid progress. There are several places should be revised in time. From the part of tax preference legislation, there are a few problems including unreasonable standard definition for SMEs, the absence of taxation legal principle, unclear tax preference orientation, as well weak tax preference targeted, low effect level, and low efficient implementation. From the part of tax collection system, there are also some adverse effects, such as the unreasonable collection and management procedures, the situation of tax service be not in place, too much discretion for tax authorities and so on. Therefore, it's so important to reform and adjust the existing legal system of tax preference.This article will focus on the perfection of tax preference legal system of promoting the SMEs development in China, based on the full collation and analysis of the current tax preference system's problems, with the help of related successful experiences of developed countries like the United States, Japan, France, Canada, South Korea.