An Investigation Of China's "Fake Foreign Capital" Tax Evasion

Since 1980s, especially after 1990s, more and more foreign enterprises came to China to invest. Chinese government gave them many favorable tax policies which on the one hand indeed helped attract more foreign investment, but on the other hand many domestic enterprises took advantage of those tax policies illegally, which caused a great loss of national tax revenue and threatened a fair market environment. On the basis of theoretical analyses, this article describes the phenomenon of"fake foreign capital", and further more suggests some ways to harness China's fake foreign capital. This article includes three parts.The first chapter is theoretical analyses about guarding against tax evasion and tax dodgery. There are two sections in this chapter. First section defines"tax evasion","tax dodgery"and"fake foreign capital". Second section introduces A-S model that analyses tax evasion and tax dodgery's affecting sectors. But this model didn't tell us how to impose effective tax supervision. For this, we try to construct a two stage game model to research that question .The second chapter is empirical analysis about China's fake foreign capital's tax evasion .first it describes phenomenon and feature of fake foreign capital's tax evasion. And than it explains the reasons of fake foreign capital's tax evasion. Last, it focuses on social harm that fake foreign capital's tax evasion did.The third chapter suggests some ways to harness fake foreign capital's tax evasion. Three principles should be paid attention that legality, equity, efficiency. The government should improve the taxation system and regulate taxpayers's behavior from legal perspective. Tax authorities should take three steps to implement supervision. First, different kinds of taxpayers should be separated. And than, discriminate different punishment that different taxpayer can bare and feel. Last come to select best supervision method. Meanwhile, strengthen collaboration between different departments.Major contribution: Novelty of study angle.Novelty of research clue.In the respects of method and material citation,the thesis combines theoretical analysis with practice analysis and introduces a large number of cases on the basis of theoretical analysis,so that the meaning of the contents is more clear,and it also enhances the feasibility and practicability of the issue.