China's Current Vat

During the tax system reform of 1994, our country pursued the value-added tax in an all-round way. Considering the investment in swelling at that time, the price rise, the overheating of economy, the financial deficit, etc., what our country implemented was productive value-added tax. But since the end of 1990s, the enormous change has taken place in the economic situation of China, and China has already changed from past resources restraining type economy into demand restraining type economy. Promoting investment and consumption, avoiding the deflation have already become the important issue to be solved urgently of Chinese Government. In conformity with economic operation conditions, it is fully under way that the productive value-added tax will be transformed into comsumption-based value-added tax in the whole country from January 1 of 2009. The reform is an important action of improving the market economy of our country that the value-added tax makes the transition, this indicates our government is brought about an advance in enterprise through the simple policy of reduction or remission of taxes, to pay attention to tax system inherent law, give play to the role of tax revenue lever, march towards a loud step, and this has great meanings in development of the tax system of our country.Productive value-added tax has the problem of levying tax on repetition of fixed assets exists, this has aggravated enterprise's burden and hindered enterprise from widen investment seriously. In aspects of development and quickening technological progress, there are negative influences especially for capital forms higher trade organically. Comsumption-based value-added tax allows purchase to pay taxes gold disposable all deducted in current period already fixed assets outside, so it can play a role in value-added tax'encouraging investment and accelerating the renewal of equipment. It is obvious the comsumption-based value-added tax can reflect the neutral tax revenue characteristic of the value-added tax even more; indicates that developing economy is a basic route to increase fiscal revenues; and it is favorable to regional economy coordinated development of promotion, etc.This text chapter one defines starting with from studying the value-added tax, through theory foreshadowing, has explained production, classification and theoretical foundation that the value-added tax make the transition of the value-added tax overallly systematically, and introduced practice and application of the system of the foreign value-added tax briefly. It has analyzed the current situation of the value-added tax of our country from historical evolution and design principle of current system of value-added tax of our country in chapter two, appraised the function of the value-added tax of our country as objectively as possible, and pointed out defect and deficiency of the current tax system. At the same time it has pointed out that carries on the feasibility that the value-added tax makes the transition in terms of government finance, financial crisis and tax collection and management. The third rule and regulation has analyzed the result of transition reform from two respects of macroscopic and microcosmic separately, therefore find deficiency and limitation among them. Chapter four has further put forward the system measure of the value-added tax and related scheme of improving on the preceding basis, including expanding the taxation range of value-added tax, reforming the small-scale taxpayer's system, improving financial management system etc.The topic of the transition of the value-added tax is disputed in the academia for a long time, and this text is an article after the government claims to implement the reform of making the transition of the value-added tax nationwide formally. There are two innovations in this text:one is the angle, it analyses the result that the value-added tax makes the transition in terms of macroscopic and microcosmic; the other is that the text has put forward the suggestions for the future value-added tax reform. In addition, this thesis has mainly adopted comparative analytic approach, theory analysis and real example to analyze that combine together, and analyse with the method of combining together synthetically.