Analysis Of The Impact Of The Transformation From Business Tax To Value-added Tax On Corporate Finance

In2011, the Ministry of Finance and State Administration of Taxation jointly issued " pilot program of transformation from business tax to VAT." And Shanghai is the first pilot. This indicates that China established a new milestone in the VAT field, since the2009VAT tax reform. To enlarge the range of the transformation from business tax to VAT and to reduce business tax and other taxes is an important content of the12th5-year plan. Transformaition from Business tax to VAT will not only help reduce the problem of double taxation resulting from business tax, that the tax can not influence the market and the division of refinement, but also help improve the integrity and extention of VAT deduction chain of secondary and tertiary. In the meantime, it willalso facilitate the establishment of the VAT export rebate system in goods and labor fields, and make an overall improvement in China’s export tax environment.For now, the reform has been taking place in Shanghai for almost2years. During these two years, the advantages are becoming more and more obvious. It has optimized the tax structure and promoted reducing tax structurally. Almost all the companies get involved in this reform has an obviousdecrease in tax burden, yet there are still some companies have a slight rise in tax burden and their competitiveness are impacted. The case companythe author use in this paper is the company the author has an intern ship in. The author mainly use field survey analysis, case analysis, literature research and qualitative analysis to make the article more abundant. In this paper, the author analyse the impact that the transformation from business tax to VAT has done to tax burden and finance of S company.According to the research, when concerned to practical business, the vast majority input tax S company occurs are directly used in production and processing of goods. When it comes to services, the input tax is rare. The deductible input tax hasn’t increase sharply after the transformation from business tax to VAT, so the tax burden increases in both domestic business and overseas business. In the meantime, the transformation influences the financial data as well. It decreases sales revenue and operating profit, andaffects the relevent financial indicators. Finally, according to the actual situation, the author forward some advice on coping with the transformation. This transformaition promotes the development of modern services. And in order to let this transformation keep implementing efficiently and playing its positive role, China should keep updating the program from time to time and companies should keep strengthening their own competitiveness and capture this chance of transformation.