The Study On Chinese Banking Taxation Reform After Joining WTO

Banking is the core and prop of financial system which is the most important part of our country's financial industries, which the steady development of banking is so important to the healthy development of national economy. According to Order of the President No.478, when《Law of the People's Republic of China on Foreign Capital Bank》shall go into effect as of Dec.11th.2006, banking in our country will open outward completely. While lots of foreign banks influx, foreign banks will bring great impact to China's banking which have abundant capital, advanced business administration and high quality assets. When China's banking is faced challenge, in addition to strengthen management itself, the more important is to perfect the tax policy. The current tax policy was formulated when the taxation was reformed in 1994, the basic pattern had no major changes though there were several adjustments in the tax policy since 1994. Banking need to be paid 11 types of taxes which are Business Tax, Enterprises Income Tax, Income Tax for Enterprises with Foreign Investment and Foreign Enterprises, Individual Income Tax, Stamp Tax, City Land Tax, Real Estate Tax, City Estate Tax, City Building and Maintenance Tax, Automobile and Ship Using Tax, Automobile and Ship License Using Tax. Among these taxes, Business Tax and Enterprises Income Tax account for 90% of taxes in banking that need to be paid which are main taxes. From the actual situation, the tax burden of banking in our country weighs too heavy and faulty tax system framework which confine the healthy development of banking in our country. This text mainly considers bank taxation of our country as objective of the research project, which confers the problem of bank taxation reform after joining in WTO contrasting mature taxation of foreign developed country and comparatively developed country. Therefore, the following measures should be taken: First, Our country must unify national and foreign capital Enterprises Income Tax in order to embody equity principle of revenue. Secondly, banks should raise managing efficiency of banking by the way of debasing the tax burden. Thirdly, simplifying the way of paying tax and examine and approve of tax. Fourthly, our country should perfect law system of banking revenue in order to advance legislative levels of revenue.