Optimization Of The Legitimacy Of The Legal Analysis Of Its System Of Tax Incentives

In essence, the tax preference has created a tax privilege, which breaks the principle of equality of taxation in order to be a control and induction tool. As a tax privilege that conflicts with the fair value of the tax, whether the tax preference can achieve the legitimacy is very important. The legitimacy of law can be divided into three aspects that is, the formal legitimacy, the procedural legitimacy and the substantial legitimacy. The legitimacy of tax preference is a form that combines the general rule of legitimacy of the law with the special rule of the tax preference. It is also the application of the legitimacy of law in the system of tax preference. In order to achieve legitimacy, the tax preference must have the formal legitimacy and substantial legitimacy. What is more, it also must have the timely legitimacy. Their principles of tax law are correspondingly in the form of tax legalization principle, proportional principle and tax neutrality .The principles of tax legalization points to the forms (including procedures); the proportional principle stresses at the individual cases (substantial content); the timely legitimacy pays its main attention to the overall of the tax preferences, to adapt it to the socio-economic development needs. That the tax preference strictly complies with the three principles is the necessary conditions in achieving legitimacy. At the same time, as a tax privilege, its legitimacy requires that the tax preference must carry a certain value pursuit, or in other words, must have rational reasons. This is mainly expressed in: its value direction in protecting the basic civil rights and its purpose of improving the overall economic efficiency of the society. This kind of ration reasons is meantime the value pursuit of tax preference, and the logical starting point from which the tax preference achieves its legitimacy. Strictly complying with the three principles is the external security, and having rational reasons is the inherent regulation. They together constitute a strict theoretical system.The main problems exist in the China's current preferential taxation system are those legislation and effectiveness. In view of actual problems, and based on the basic theory of the preferential tax legitimacy, we can make our efforts in two aspects to make our current tax preference system better: The first one is law system optimization, and the concrete measures are: to make legislators explicit, to make tax preferential policy subject to law and to make legislation open to public. In the entities aspect, the top priority should be in proceeding optimization of regional preferential taxation system and industrial preferential taxation system, making improvement in those aspects of recipients, ways and goals of the preference.