Tax Planning About M&a In China: A Case Study Of Shanghai No.1Department Store Co.,Ltd.

There was five times of M&A tides in global since1990s, and even the scale thetrading times and countries regions involved were getting larger and larger, while theinterval of time was getting shorter and shorter with the longer duration. GeorgeJoseph Stigler, American famous economist and the Nobel Prize winner in economics,said,“That an enterprise becomes a giant enterprise through annexing its competitiveadversaries is a protrusion phenomenon in modern economic history”,“None ofAmerican large companies did not grow up through the annexation of a certain degree,a certain way, and nearly no large companies grew up only by interior expansion.” Itis obvious that M&A is an important way to get high competitive and developstrategies. In recent years, China’s enterprises have changed their attitudes. Theyparticipate in the international competition and resources reallocation instead ofwaiting step by step. With the development of economic globalization, China’senterprises are faced with great opportunities and challenges. In the M&A processes,the important factor is whether M&A transaction can generate profits and reduce theimpact of the tax burden. Therefore, it is extremely important to look for tax savingspace of M&A reorganization.M&A is a normal enterprise behavior in the condition of marketing economy.It’s is unavoidable to have some tax issues in the process of M&A. So how tominimize the tax burden and obtain maximum profits becomes an important factor toM&A. If tax incentives can be enjoyed, it will come true.On the basis of the basic theory of M&A and tax planning, this dissertationfirstly, analyzes of the connection between M&A and tax planning and theninvestigates the impacts of main items of taxation, such as turnover tax and incometax, to M&A. And then, some constructive suggestions are given to guide enterpriseshow to plan tax reasonable in the process of M&A. Finally, discussion and analysis aregiven to take the merger case between Shanghai No.1Department Store Co., Ltd. andShanghai Hua Lian Co., Ltd. for an example.Applying the standard study and case analysis, this dissertation analyzes of theconnection between M&A and tax planning, complements and perfects the theoryabout tax planning in M&A. And also it can provide constructive suggestions toenterprises in their M&A activities. In this dissertation, in this paper, the innovation lies in that the differencesbetween tax institutions are summarized again and perfects the theory about taxplanning in M&A. And according to the new policies of accounting standards and taxpolicies are promulgated, the new methods and ideas of tax planning in M&A are putforward.