Research On Problems Of China Value Added Tax Accounting

Before the 1990 s, China was in a stage of highly finance-tax unification when financial accounting was completely in line with requirements of the tax law system and finance-tax difference issues almost did not exist. With the implementation of a series of adjustments about tax reform and accounting standards for business enterprises in 1994, finance-tax difference initially occurred for the corporate income tax, thus promoting the emergence of tax accounting which takes income tax accounting as the core. Before 2009, studies on tax accounting issues basically focus on the corporate income tax. The income tax accounting system was not established until 2009 when relevant check computation was normalized effectively and finance-tax difference was adjustment properly. Later, the study object has been shifted to value-added tax accounting by the academic circle.Currently, there are two kinds of theoretical hypothesis about the value-added tax, namely, “hypothesis of agency” and “hypothesis of cost”. The former one is proposed earlier and is the theoretical basis of carrying out value-added tax in China currently. Due to the further mature and improvement of the fiscal and taxation system, the independence between accounting standards and tax law has been increasingly enhanced. Problems implied in the “hypothesis of agency” have gradually appeared, and many scholars have conducted analysis and verification from diverse perspective, thinking the value-added tax should be a cost of enterprises. Later, the “hypothesis of cost” has gradually forms and developed into the theoretical basis of the system reformation of the existing value-added tax financial accounting in China.The importance and complexity degree of China’s value-added tax accounting is not second to the income tax accounting. The inadaptability between the value-added tax accounting mode of “finance-tax combination” at present and the social economic development has become more and more prominent. Finance-tax difference has led to the frequent occurrence of differences and contradictions in value-added tax financial accounting, which directly decreases the accounting information quality of the value-added tax. Meanwhile, due to the property of tax excluded in price about the value-added tax, the value-added tax accounting information at the end of term cannot be fully disclosed in financial statements, which is obviously extremely incompatible with its status as the first major tax. Therefore, it is imperative to carry out reform about the existing value-added tax financial accounting system in accordance with the theory of “finance-tax separation” by taking the “hypothesis of cost” as the theoretical basis.By reviewing the relevant domestic and overseas study status quo about the value-added tax accounting, this paper takes the “hypothesis of cost” as the theoretical basis of the value-added tax financial accounting. Prominent issues specific to the value-added tax accounting in China are explored, for instance, the recognition and measurement is against the historical cost measurement attribute and matching principle, the quality of accounting information has been weakened, and the accounting information disclosure is insufficient. Further, value-added tax accounting problems with the background of “business tax replaced by value-added tax” is analyzed, the financial accounting after setting up the “finance-tax separation” accounting mode, realizing the cost-orientation of value-added tax, and normalizing “business tax replaced by value-added tax” is proposed. Policy-related suggestions for accounting information disclosure system improvement are put forward。And application of the above countermeasure to daily purchase and sale business for the value-added tax accounting reform test, and application prospect of value-added tax accountiong reform from two of the feasibility and operability are analyzed. So as to boost the establishment of the new value-added tax financial accounting system as early as possible, normalize the value-added tax financial accounting, enhance the value-added tax accounting information quality, and increase the sufficiency of information disclosure.