The Impact Exerted By The Reform Of BT To VAT On Labor- Intensive Enterprises’ Tax Burden And The Coping Measures

Under the political background that the tax reform of State practices BT to VAT entering a crucial stage and the socio-economic background of facing with the greater social labor employment pressure, the author chooses the tax burden of value-added of tax labor-intensive enterprises in the process of BT to VAT for study. It has both important theoretical and practical significance to discuss the problem of labor-intensive enterprises combining with BT to VAT.The paper firstly begins with the theoretical definition of labor-intensive enterprises and the theoretical analysis of VAT to briefly review the characteristic that the enterprises’legal added value is bigger than that of other type of enterprises under the condition of Labor-intensive enterprises’ profit space limited. Secondly, through theoretical analysis and empirical data analysis in the third chapter, this paper illustrates the impact on the VAT burden of the enterprise due to the implementation of BT to VAT. On the one hand, due to the increase of input tax deductible, the tax burden on the taxpayer’s of labor-intensive enterprises is reducing overall for the original VAT. On the other hand, the labor-intensive enterprises’ VAT tax widely increased result from the inherent characteristics of labour-intensive and that the input tax is difficult to fully collect. Thirdly, on the basis of analyzing the influence that labor-intensive enterprises’ tax burden exerted by the implementation of the BT to VAT policy, this paper further analyses the overall impact of labor-intensive enterprises due to the implementation of the BT to VAT policy, including the development opportunities of speeding up the transformation and upgrading the structure and improving the internal management. At the same time, this paper discusses some management challenges such as the increased financial risk and the VAT tax and comparative advantage weakening.Based on the above analysis, the author proposed that labor-intensive enterprises should pay enough attention to the reform of the BT to VAT policy and prepare for the enterprises’ strategic thinking, internal management, management behavior, and tax related transaction management. Of course, the enterprises should also emphasize on the tax planning in detail for the tax-related business, so as to reverse the situation that tax burden increasing. Lastly, the author puts forward that the enterprises should constantly asses and analyze the business and management in the process of reform, to better respond to the BT to VAT measures suggested, expecting to promote the reform of the BT to VAT and the development of labor-intensive enterprises.