Reflection On The Perfect Of China's Value Added Tax Law

Since the tax system reform in 1994 in our country, sequent year's practice has witnessed a lot of disadvantages of VAT law, which is in great need of prompt improvement and perfect.The current VAT law adopts the production-oriented VAT, now along with the rapid development of economy, the disadvantages of the production-oriented VAT has been getting so apparent that no longer can it keep abreast of the times. Not only is the production-oriented VAT detrimental to the development of foreign trade, the optimization of the enterprises' organization structures ,the optimization of industrial structures, the balance of regional economy, the imposition of taxes. In a word, the hash realities demands that our country introduce consumption-oriented VAT in a planned way.The taxable scope of VAT is too narrow, the boundary between the scope of VAT and that of Business Tax is not clear-cut, likely to lead to confusion. The scope of VAT should be enlarged appropriately.According to the current VAT law, VAT payers consist of two categories: normal payers and small-scale payers. Tax computation method for payers makes the former enjoy superiority to the latter, which in my view should be changed.The current drawback mechanism stipulated in the Value-Added Tax Law has many problems , such as the mechanism is somewhat nonscientific ,procedures and operation are complicated , and the phenomena that the nation often doesn't pay the tax are getting more and more serious .We should improve the drawback mechanism in order to meet the needs required by WTO The current Value-Added Tax Law prescribes too many items exempted from taxes ,thus unfair competences derive from it, and influences the effective running of the the tax credit system to compute the VAT payable , So we should regulate the items exempted from taxes.