Study Of Chinese Overseas Investment Tax Incentive System

In the late of 1990s, to encourage capital outflows, and step up economiccooperation with the international community. China implemented the "going out"strategy, the combination of "please come" and "going out" raise the level of openingup across the board. However, at the beginning, the focus of China's reform andopening up is to attract foreign investment, and formulated a series of preferentialpolicies, especially preferential taxation policy, and it has achieved noteworthyresults. And to encourage domestic enterprises to invest overseas has almost no taxconcessions. Tax incentives to encourage the use of capital, both from the inspirationof China's success in attracting foreign investment and the valuable experience ofForeign direct investment in developed countries. The purpose of writing this paperis to study how to learn from the advanced experience of the developed countries, issuited to China's actual situation, in line with international practices, norms integrityof the overseas investment tax incentive system. For this purpose, this paper isdivided into three parts to elaborate:The first part is an analysis of the current tax system for overseas investment.Briefly introduction of China's overseas investment from the development processand current situation, and indicate the problems of overseas investment in China: anirrational industrial structure, management structure backward, absence of protectionpolicy etc, which raises the analysis below the current overseas investment tax policy.China's current overseas' tax policy is a lack of investment-oriented and nodifferential tax policy. The basic framework include two parts of domestic taxsystem and foreign tax revenue agreements. Through the status quo introduction ofthe income tax system, the tariff preferences and the external tax agreements, pointout the defects of Overseas investment in the existing tax policies.The second part begins with the comparative analysis of tax policy in thedeveloped world's foreign direct investment, to provide some valuable experiencefor the establishment and improvement of China's overseas investment tax incentivesystem. In the article there are brief introduction of relevant tax policy in the UnitedStates, Japan, France and South Korea, through the summary of these policies, thefollowing revelation are as followings: overseas investment tax incentives includeincome tax, tariff concession and the international tax agreements signed.The third part is the core of this thesis, a study of how to revise and effectChina's overseas investment tax policy and to comprehensively establish China'soverseas investment tax incentive system.Firstly it is an elaboration on the necessity,the feasibility and the basic principles of establishing and improving China'soverseas investment tax incentives. Secondly, to design specific measures in termsof income tax, tariff and taxation agreements to encourage overseas investment, and clearly point out the investment in industry oriented and regional oriented from taxpolicies. In the end of this paper, a summary of what should be paid attention to inthe process of establishment and perfection of the overseas investment and taxincentives system.