The Impacts Of Value-added Tax Reform On Firm Performance In China

The main content of value-added tax reform is to touch buckle income tax contained in fixed assets, and its essence is the Conversion of the Productive Added Value Tax into the Consumptive One. This reform has been a long term and experienced pilot projects as follows: the first pilot project from 14th September 2004 in 8 industries of Northeast China, to the second pilot project from 1st July 2007 in 8 industries of Middle area of China, and then to the third pilot reform from 1st July 2008 in 8 industries of East Inner Mongolia and industries of coke production, aluminum electrolysis, steel production and small thermal power plants in earthquake-stricken area of Sichuan, Gansu and Shanxi. The VAT reform was implemented in the whole country in 1st January 2009.Based on the reform in 2009, this thesis described the aim and meaning of VAT reform in the beginning. With the review of prior tax reform and conjunction of normative analysis and positive analysis, the thesis analyzes influences to companies in fields of fixed-asset investment, tax burden, ROE, EPS. The data are from 200 public companies of 6 industries between 2008 and 2010. The creative factor of this thesis is connect the influence and the solution of VAT reform, and provides valuable suggestions for company tax reform understanding and tax planning.