China’s Banking Research On Tax Reform

As the most major financial institution, bank is the important component of our countrynational economy, and has an important influence on the national economy. Whether the taxenvironment of banking industry is reasonable or not directly affects China’s bankingindustry’s operating results, while optimization of the tax system reform of banking affects thedevelopment of our national economy. As an important filed for a country’s economicdevelopment and stability, banking and taxation system occupies an important position in theworld economy. Along with our country banking industry competition intensifies, the reformof the tax system of banking is more urgent. Though our country’s banking tax system hasalso carried on the corresponding reform, it still has many problems compared with that ofother countries, which restricts the development of China’s banking industry, and affects thecomprehensive competitiveness of China’s banking industry.The incomplete banking taxation system has not only had an adverse influence to thereform and development of banking industry, but also seriously affected the national financialrevenue, so the reform of China’s banking tax system is imperative. According to the presenteconomic situation, this paper put forward effective measures and suggestions to tax systemreform of China’s banking industry, through analyzing from banking system developmentcourse and the present situation and absorbing the advanced experience from the foreignbanks’ tax system, to enhance management level and international competitiveness of China’sbanking industry.Based on the background and purpose as described above, this thesis makes acomprehensive and systematic discussion on our country banking tax system problem on thebasis of the related knowledge of the public finance, finance, taxation, adopting the literaturestudy method, empirical analysis and comparative analysis. This paper is divided into sixparts. The first part is the introduction, which mainly introduces research background, purposeand meaning, and the related literature research at home and abroad, paper’s frame andinnovation points. The second part elaborates the objectives of the reform of the banking sector tax system, and introduces the theory of industrial policy、theory of Public Finance andoptimize the tax system theory，as the theoretical basis of this study banking tax reform. Thethird part mainly introduces the history and the current situation of our banking taxationsystem from the history and the current prospect, and expounds a series of changes of taxsystem reform since the founding of our country. The fourth part is the focus of this paper,which mainly analyzes our country banking system’s current problems: on the one hand, theturnover tax burden is overweight, preferential tax is unreasonable and double taxationphenomenon is serious; on the other hand, the fixed income tax rate is unfavorable to thedevelopment of small and medium-sized banks’ development, and special funds without taxexemption is unfavorable for bank to withdrawal the provision for bad debts. The fifth partbriefly describes foreign banking system. In light of foreign banking system and through theresearch on the foreign banking system, this paper uses comparative analysis to analyze thedifferences in banking tax system between our country and foreign, which found our countrybanking system deficiency and the advanced experience of the foreign banking tax system,and put forward some valuable enlightenments on tax system reform of China’s bankingindustry. The sixth part is mainly about suggestions. Through research on the present situationof our country banking system and forecast on development trend, and according to theprinciples of fairness and efficiency, international principles, combined with our country’scurrent financial background, as well as drawing lessons from the advanced internationalexperience, this part puts forward countermeasures to adapt to the development of China’sbanking industry tax reform.