Perfection Of Local Tax Legal System In "post-‘Replacing Business Tax With VAT’ Era"

Replacing Business Tax with Value-Added Tax(VAT) is another important reform since the tax reform in 1994. It not only relates to the integration of the two categories of taxes, but also leads to the joint reform of other taxes. In accordance with the State Council’s deployment “Getting a full completion of replacing Business Tax with VAT in the 12 th Five-Year Plan period”, the reform has entered a crucial stage. “Post-‘replacing Business Tax with VAT’ era" is coming. Under this background, many problems appeared in local tax legal system. This mainly shows in three aspects: the lack of financial transfer payment legislation, the loss of principal taxes in local tax legal system and the defects in the field of tax collection and administration. They all need to be perfected. After analyzing the problems in local tax legal system and drawing on the useful experience of foreign models, scheme could be designed accordingly on the base of the reality of our country. Along this logic, this paper is divided into the following five parts:In the first part, it gives the interpretation of the two major concepts about replacing Business Tax with VAT and local tax legal system. The former discusses from three aspects: the meaning of replacing Business Tax with VAT, the evaluation of this reform, "post-‘replacing Business Tax with VAT’ era". It provides the background for the whole paper. The latter discusses the composition of local tax legal system on the base of the definition of local tax and then constructed a broad conception.The second part sums up three prominent problems in local tax legal system after analyzing this tax reform. These three prominent problems include the lack of financial transfer payment legislation, the loss of principal taxes in local tax legal system and the defects in the field of tax collection and administration. Completing local tax legal system will regards these as the starting point.The third part lists the theoretical principles that completing local tax legal system should follow. It includes the principle of legal tax, fair tax and efficient tax. These three principles provide guidelines to improve the level of legislation of tax law. It also gives a lead to perfect the system of tax substantive law and procedural law.The fourth part carries on the inspection to the local tax legal system abroad. It firstly introduces the model of local tax legal system in four developed countries: America, France, Germany and Japan. After that, it discusses the beneficial enlightenment to perfect the local tax legal system in China combined with the three main problems.The last part is the idea to complete local tax legal system in "post-‘replacing Business Tax with VAT’ era". According to the problems above, it can begin with three aspects: perfecting legal system of vertical tax distribution, optimizing the setting of local tax, promoting the construction of tax law enforcement systems and the perfection of legal system. Specifically, the former asks for a rationally divided weight of shared tax and a normative legal system of financial transfer payment; the middle covers the perfection of the legal system of income tax and resource tax, the legislation of real estate tax and environmental protection tax; the latter involves making organization law of tax authority and improving the legal system of tax collection and management.