The Transnational Business Tax Planning

Since the late 1970s, many Chinese enterprises have gone abroad for transnational operations. After China joins the WTO and implements more liberalized economic policy, transnational operations have brought both challenges and opportunities, which require professional studies with regard to theory and practice of tax planning in transnational business operations. This thesis focuses on international taxation planning while keeping transnational businesses stay with their tax obligations.This thesis includes four parts.Part I introduces the current situation of Chinese business transnational operations and international tax planning.Part II introduces the meaning of international tax planning, its features and theoretical analysis.Part III reviews the difference of taxation in various countries, including U.S.A.. Japan, China and other countries, with focusing on the application of tax planning in financing management, transnational investment, transfer pricing, and avoiding being a regular entity. The affect of "weakened capital taxation" to financing management and the affect of CFC law to transfer pricing are also analyzed.Part IV concludes that it is essential to combine the taxation theory study with practice so as to make an effective legal tax planning. Finally, the thesis emphasized that more attention should be given to the precautions of such risks as financial affairs, market, law, etc. in order to reduce the risk of tax planning.So far, transfer pricing has be done extensively in the international tax planning, more and more countries have paid attentions to it and made the counter methods. Even so, it is easy to find that the taxation in certain countries still have some margins.The author argues that tax planning is done under the specific situations, but the enterprise's state and the tax policies are constantly in change. So flexibility is essential to ensure the realization of enterprise's global strategy.The author also argues that more attention should be paid to not only the results of tax planning, but also the legality of tax planning.