The Study Of Future Mainland China Legacy Tax And Gift Tax Planning

Nowadays, most of the countries in the world or the district like Hong Kong and Taiwan levys the legacy tax. In the early years of 1950s , Mainland China had levied legacy tax for a few years, but the legacy levy was only a few. Afterward, there was also a legacy tax on "The Implementary Rules of the National Tax Policy " released by the State Council Department. But it hadn' t put into practical effect because of the entire people's ownership or collective ownership and the planned economy system. Today, after 50 years Mainland China propose levying the legacy tax based upon the fast development of economy after China's reformation and opening-up policies. Because of the diversification of the social wealth forms of distribution, there is a group of people have already gathered a certain percentage of resources amount in the society, and it is assign uneven phenomenon that shows the existing income gap more large, and charge legacy tax is alleviate effective measurement of contradiction this to become undoubtedly to seek. At the same time, the charge legacy tax reflect the international reciprocity and principles, it can improve the taxation system to find much fair in the social wealth allocation.Legacy tax major account is to tax a few higher or highest revenues income properties which people left to their relatives or inherits when he or she is dead. Total solicit tax revenues count down a very small proportion in whole government yearly fiscal revenues. But its social effect is far away from their economic meanings, it is a sound and fair tax. On one hand, it encourages people not to reap who has not sown by ancestors' legacy. And want through one's own efforts and hard working to create one's own wealth, stop the extravagance and waste, and irritate the people with higher income to consume promptly. On the other hand, much donation to the society and other peoples, support the development of welfare project and plans in social public services. The accumulation of the personal volume wealth always depends on the society lots of support and resources, so it is necessary to feedback to the society, help to alleviate the contradiction in social distribution. So, seek the right way or methods to charge the legacy tax and lie in all government's property left over to be died by the inherit, the tax solicited to taxpayers who need to be taxed by the legacy tax law in order to redistribute the wealth of society.Gift tax is one of the taxable methods for the property owner, the tax that solicits while someone is transferring or presenting his or her property to others. Naturally, for remedy deficiency of legacy tax, defend and prevent to who want to escape the gift tax, belong to the supplementary tax category of the legacy tax. But from the tax items oriented point of view, legacy tax and gift tax in the real world is two sides in same system for that the riches transfertheir own wealth. But in gift tax revenue, which usually only levy whole nation or total local areas taxes revenues of between 0.8% and 2%. So in the nation's total fiscal revenues, it is just a small portions and insignificant. Obviously, the main purpose to levy the taxes, lie in alleviating the question of wide gap between the riches and the poor caused by difference of resident's normal income, in order to promote the social welfare.The fiscal is the mother of the multiple government policy, government lesson tax income is it can obtain fiscal revenues, and fiscal revenues are national administrative major operation incomes. Mr. Adam Smith in 18th century (A. Smith) present one proposal taxation needs to match the fair, clean, convenient and make the levy taxes expenses minimize to reach for four major canons of taxation which he wrote in his ' Wealth of Nations '. Look over all tax structure, the legacy tax and gift tax belong to the income tax of the direct tax system, can meet the above mentioned principles, The legacy taxation among the principles when the property owner dies, had the rights and obligations to be taxed, property of value objective, and levy and seek the tax charged only to the people who heir the property or the property manager. Because legacy tax adopt progression tax rate, solicit legacy tax can increase fiscal revenues of government, and can prevent the most wealth much concentrate on a few people and can be more fair for all (The rich and the poor) between the rich and the poor excessively through the reallocation of the wealth.Beijing 2005, April 6 (Xinhuanet) Mr. He Zhyuan, committee member of Standing Committee of the National People's Congress, shows while interviewed by reporter of" People's Daily ": It is still possible that the tax law of the legacy is issued in next one or two years. He Zhyuan thinks the draft of " law of real right" has already entered the second step now, can estimate this year fully implement, this law and rules in levy legacy tax the important legal foundations.Famous economist Li Yining in China points out, in order to prevent the taxable person of legacy tax from shifting, dispersing the property, legacy tax and gifting taxes should be issued at the same time.