Marketing Research In Shenzhen Mobile In Financial Prospect Under VAT Reformation

According to the requirements of "Twelfth Five-Year Plan" and "Government Report of2011", the Ministry of Finance and the State Administration of Taxation are researching a way in processing the tax mechanism from business tax base to value-added base in the telecommunications industry. This pilot process is impending in the telecommunications industry. The prospect of the VAT reformation in telecommunications industry will be highly possible to be realized in the year2014under the present circumstances.Shenzhen as one of the Special Economic Zone and the Municipalities Separately Listed on the State Plan city has its ad hoc political and tax environment. China Mobile Group Guangdong Co., Ltd. Shenzhen Branch (hereinafter referred to as "Shenzhen Mobile") is one of the local branches of China Mobile Group Guangdong Co., Ltd.(hereinafter referred to as "Guangdong Mobile") in Shenzhen, which also is the largest operator locally. The VAT reformation has its impacts over several aspects, not only in tax categories, but also brings in a huge challenge to business operations, which involves different sectors of management, including company management, marketing, procurement, financial management. IT systems, tax declaration, etc. Especially the impact on marketing, may directly affect the recognition and measurement of the VAT output tax and VAT input tax. Implementing different methodologies of tax calculation can ultimately differ in the VAT proceeds, thus affecting the business of operating income and accounting profit.In order to "ensure a smooth transition and reasonable tax avoidance", this paper was starting from a financial perspective, focusing on marketing and researching the coping strategies of Shenzhen Mobile. Firstly, the paper introduced the general background of Shenzhen Mobile; followed by a detail analysis of5essential issues of input and output tax separately, including the impact and correspondence. Finally, the paper evaluated the effect and summed up the experience. In every marketing factor, we start from a financial perspective, discussed and analyzed in four dimensions such as the current situation and tax status, the possible tax treatment post VAT scenarios, analysis of effects of different circumstances, VAT reformation proposal; in order to raise systematically viable and legitimate marketing initiatives to deal with. Under the negotiation of more beneficial tax policy and tax planning, expected annual savings in output tax is approximately340million, and the annual savings for input tax is roughly9.36million.