Western China Foreign-related Taxation System Reform

Occupying one third of China's administrative regions, administratively, western region of China includes Chongqing municipalities; Sichuan, Guizhou, Yunnan, Shaanxi, Gansu and Qinghai provinces; Ningxia Hui, Guangxi Zhuang and Inner Mongolia Autonomous Region. With the beautiful natural scenes, abundance natural resources and a vast territory, western region of China has become a great potential market and an important area for China' s economic strategy. However, for some natural, historical and social reasons, the economic development in western region of China has fallen behind and the economic gas and conflict between the west and the east has already become an increasingly serious problem of china's macro-economy. Therefore, it is a great strategy of national development as well as a great task for the Communist Party and our country to expedite the development in western region of China. As a result, on June 17, 2000, the Central Government made a strategic decision to expedite development in the Western Region, which was called, Development of Western Region of China.As we all know, the most importance of economic development of western region is to attract the investment, especially the foreign investment. As one of the important lever of regulating national economy,the tax policy is playing a remarkably important role in the development of western region of China. Since the current preferential tax policies and laws for enterprises with foreign investment and foreign enterprises in China were formulated during different periods of reform, according to different needs of economic development, different opened orders of the areas and different situations, they can no longer adapt to the national policy about Development of Western Region of China. Therefore, it is of very important practical significance to discuss the reform of preferential tax policy for enterprises with foreign investment and foreign enterprises in the western region.Under the economic environment of implementing the policy of development in the western region, by considering the physical conditions of every administrative region in the western region, through analyzing the current situation of foreign investment, the history, status quo, reform and preferential tax policy for enterprises with foreign investment and foreign enterprises preferential policy of foreign taxation, this text discusses the inherent limitation of the current foreign taxation system and tries to take a proposal to further the reform of tax system in West China, especially make an more detailed discussion in terms of income tax, added value tax, personal income tax, taxation environment for enterprises with foreign investment and foreign enterprises in western region of China, and finally put forward a suggestion that how torestructure the foreign tax policy in west region of China to meet the demand of Development of Western Region of China.In conclusion, it is an urgent and essential task to deepen the reform of traditional tax system, create a good financial environment, put a powerfully attracted financial policy into practice, and achieve the greatest foreign revenue so as to speed up the economic development in West China and help the companies exploit the universal market, finally promote the realization of middle-class society. At the same time, it could be realized that the reform of foreign tax system in West China will push the development of the whole country and offer a larger space of China' s development by bringing about greater business opportunities to achieve China' s economic take-off.