China's Value-added Tax To Run The Research And Reform Ideas

1.Objectives and MeaningnessSince its introduction in China in 1979 , VAT is becoming more and more important in Chinese taxation system. But with the deepening reform and the changing international environment, the existing VAT system faced great challenges. This dissertation argues that it is urgent to initiate VAT reform so that China can take the greatest benefits of VAT. Through theoretical analysis and practical examen, it explores the various problems of existing VAT system and try to find out their causes. At the same time, by learning from the overseas experiences, the dissertation proposes the objectives, the directions and the approach of VAT reform. The author hopes that this dissertation will be helpful to the reform and transition of VAT system in China.2. Main Content and ideas of the thesis This dissertation falls on 4 parts : 1) the generalization of VAT; 2) the implementation of VAT & analysis of its problems; 3) the urgencies for reform ; 4)more detailed ideas on reform . 1)the generalization of VAT 1.1 concepts and characteristics of VAT & its effects-analysis Started with the concept and content of VAT, this dissertation analyze its income effects and economic effects. The analysis proves that the neutralization of VAT is based on single tax rate and require tax base as wide as possible , so only the added value should be taxed and the VAT system should be convenient for both administration and collection.1.2 comparation of VAT types Started with the concept of different types of VAT, this dissertaion analyze the different effects of 3 types of VAT: production type, income type and consumption type The analysis confirmes that, income type and consumption type can't solve the problem of the repeated levy and isn't good for the development of economy, but consumption type can do or be .so, consumption type is most effecient and its long-term income effects are greatest.1.3 selection of ideal VAT type The analsis lays on the international experience and future tide and the factors of effecting on the choice of VAT type.it shows that consumption type VAT is the ideal choice.2) the analysis of implementation and problems 2.1 the practices and effects of existing VAT system By retrospecting the evolution of VAT in China,this dissertaion acknowleges the important role of VAT in various fields as promoting the establishment of Chinese socialist market economy ,amassing huge fiscal revenue ,supporting the economic structural adjustment etc. 2.2 the main existing problems The existing VAT system bring about problems and negative effects on 2 sides :first, the problems on the side of VAT strucure include: the VAT types need adjustment,the rate structure require simplification, etc. Second,the problems on the side of collection and adminstration include : internal balancing mechanism is damaged, the means of collection and adminstration is lagging behind etc. So, it is necessary to reform VAT. 3) the urgencies, principles and approach of VAT reform3.1 According to the background of tax reform in 1994, this dissertation holds that the existing VAT system is in conflicts with the principles of market economy as well as WTO, it is in conflicts with economic enviroments too.So, it is urgent to reform VAT .3.2 the principles and approach to reform This dissertation argues a transition from " realistic optimization" to " idealistic optimization" in the process of VAT reform in China. It proposes the objectives and principles of reform .The basal approach is, to mend the pace of turning production type to consumption type , to enlarge the VAT taxable scope step by step, to adjust and simplify the VAT rate, to abolish the exemptions and reductions step by step, to standardize the definition of small VAT taxpayer, to perfect the definition that exporters is entitled with the total amount of refunds, to stengthen tax collection and administration continuously by advanced managing ways.