Research On Tax-Planning Methods Applied In Listed Companies’ M&A Transactions Of China

Our country’s security market has achieved great success after more than20years of rapiddevelopment; In the process of development, the listed company’s Merger and Acquisition transactionhas happened more and more frequently. From January2008to July2012, the M&A committee ofCSRC have reviewed256M&A applications from listed companies. The listed companies vary frommanufacture industry to media industry and almost covered every industry. The categories of M&A arealso varied, which shows the energy brought by the market-oriented economy.At the same time, the government and the authority, which is regarded as the rule-maker of thegame and market regulator, is also establishing laws and policies to regulate the tax in those M&Atransactions. Since2008, when the new Enterprise Income Tax Law was implemented, the Ministry ofFinance and the State Tax Bureau have issued "The notice about enterprise income tax treatment inenterprise restructuring transaction "in2009(Caishui [2009] no.59). And based on this, they havelaunched "The notice about enterprise income tax management method in enterprise restructuringtransaction” in2010(Guoshui [2010] no.4).The promulgation of the tax policy has resulted changes of tax environment. In this context, thereis no doubt that tax has become a very important factor that should be taken into account when the M&A decision have been made. No matter from the view of saving tax expenditure, or from the viewof reducing the tax risk, it is very necessary for enterprises to do the tax-planning. As a public company,the listed company’s every action and every movement will be exposed to investors. As the directbenefit of tax planning is the delay-payment of tax, the intrinsic value of the listed company will beincreased due to this. A good tax planning method can not only help bring the tax synergy effect to theenterprise, but also can help increase the investing value of the listed company.This thesis summarizes274cases accepted by the M&A committee of CSRC during the passingfive years (January2008to July2012) and gets the following conclusions: the industry distributioncharacteristics of the M&A transaction, the intentions of M&A, the methods applied in M&A and thetax-treatment categories in those transactions. And the real transactions have been applied as cases inthe thesis. The conclusions can provide useful experiences and references for future tax planning.In order to cover as many methods as possible, this paper is divided into six chapters: the firstchapter is the introduction, the second chapter is the domestic and foreign literature review, the thirdchapter is the basic theory and policy, the fourth chapter is case statistical conclusion, the fifth chapteris the main body of the article: the tax planning methods applied in each stage of listed companies’M&A transaction. The sixth chapter is the research conclusion and limitations. The main body of thearticle involves each stage of the M&A:1) the selection of target enterprise,2) the payment approachof the M&A,3) the financing approach of the M&A,4) the capital withdrawal stage of M&A.The innovation of this thesis is that the samples are selected from the security market and the realtransactions have been applied, which illustrates the types of tax planning methods in a more practicalway.