Tax Regulation Of Private Equity Fund In China

As a new investment tool, Private Equity Fund（PE fund）has developed formore than20years in our country. The first kind of Private Equity fund is mainlyVenture Investment Fund and to encourage its development the country had issuedsome preferential tax policies. With the continuous development of the PE fund, thesepreferential tax policies begun to show some disadvantages that the regulatory scopeis too narrow especially after Buyout Fund and Growth Oriented Fund appeared. Thelegal organization form of PE fund is various, in addition to the corporation form stillhave trust form and limited partnership form. The tax policy for PE fund will differentbecause of the different organization form. At present, the existences of PE fund inour country are mainly corporation form and limited partnership form. This paper is toanalyze the problems in our Tax Regulation of PE fund and put forward suggestionsfor improvement.The paper is divided into four chapters. The first chapter to proceed from thebasic theory, introduces the concept, type, characteristics and legal organization formof PE fund, and analyzes the impact of preferential tax policies for PE fund; Thesecond chapter is mainly to introduce corporation form PE fund, finds the problems ofits tax regulation such as double taxation, the limit time of losses carried forward istoo short, then puts forward suggestions for improvement. The third chapter is mainlyabout the limited partnership form PE fund, finds the problems of its tax regulation, for example, it can not enjoy tax incentives, and the partners have to burden heavytax, then puts forward suggestions for improvement. The last chapter analyzes thecurrent tax policy on macroscopic, researching from the perspective of nationallegislation level and local policy level. At the same time, it mirrors the tax policyrevision process of other countries especially the developed countries to provide areference for building the tax system conducive of PE fund in our country.For PE fund, gains and risks exist at same time.When investors making theirinvestment choices, they usually measure the expected return and investment risks.The related tax policies often affects the investment costs and expected benefits ofthe investors, and play a crucial role in the measure of investors. The current taxpolicies on PE fund in our country, make a positive role in promoting PE fund butstill have many problems. In this paper, aimed at the problems in the current taxpolicies, the author puts forward own views and countermeasures, giving sometheoretical support for constructing a reasonable tax system in our country of PEfund.