Perection Of Chinese Local Tax System

The tax reform implemented in1994under the background that fiscal "separation of powers and benefits" severely weakened the central government macro-control ability and administrative ability is based on the early1990s. From the practice effect through the20-year, on the one hand, The tax reform, which strengthens the central macroeconomic regulation and control ability as well as administrative ability that fully arouse the enthusiasm of the central and local governments, marks the country’s local tax system prototype of the basic form. On the other hand, it is an important factor to the basic financial difficulties because the trait of "authoritarian" problems brings out "finance rights move up and down" obviously.The request in the eighteenth big report called us to speed up the reform of the fiscal and taxation systems with building a local tax system to structure optimization and the social fair taxation system, while deepening the reform of the taxation system and local tax system as well as the reform of the local tax system was the focus of China’s current fiscal and taxation reform work in the third plenary session of eighteenth. The target path of china’s tax system reform is that using compression level and setting up the management system of the flat fiscal countermeasures to match the levels of local government system, which is based on the theory of fiscal decentralization, including optimize the local finance classes deeply, with sorting out the governance, giving the local government articles reasonable at various levels, and cultivating local stability of the duty and auxiliary tax system, as well as improving the tax collection and administration mechanism and transfer payment system between governments constantly to standardize the purse strings according to the classification fixed at all levels of tax revenue in order to form stable and adequate financial mechanism in the local governments at various levels in the end.The problems like lack of taxation, un-scientific tax division, Unreasonable tax structure, un-sounded management mechanism and lagging of tax justice is needed to be solved. The reality that lacking of local financial resources and local main body tax loss because of the expanding of business tax instead by VAT tells us it is urgent to rebuild the local system perfectly. The paper inspects the development of evolution in China’s local tax system since the reform, not only ensures the achievements of the tax reform, but also points out the existing problems in local tax system as well as clarifies the thinking of improving the local tax system on the basis of deep analysis of China’s local tax system reform. And further defines the direction demand of China’s local tax system reform from the principle of improving the local tax system optimization direction and goals, levels of local government, realistic constraints, highly decentralizes and summarizes the formation and development of tax system in some countries, including the United States and Australia, which are highly decentralized, and Japan and Germany, which are moderately decentralized, as well as the United Kingdom, which belong to different types of decentralized tax system, in order to try to provide beneficial enlightenment for China local system reconstruction.Finally, based on China’s national conditions to put forward that consumption tax, resources tax, personal income tax and gift tax can be given as the main body of taxes for the provincial level, while tobacco tax,value-added tax and enterprise income tax for sharing auxiliary taxes. Real estate tax, city maintenance construction tax and environmental protection tax can be given as the main body of taxes for the city and county level, while supplemented by car value-added tax enterprise income tax, stamp tax, deed tax, and sharing of the VAT. In addition, accelerate the reform of tax legislation and administrative system with raising the proportion of Shared tax and make relevant tax reform pilot work, as well as improve the system of transfer payments are needed to be done in the short term, while in the middle term, foster appropriate tax, configure the reasonable auxiliary taxes, reform relevant taxes and introduce some new taxes timely, as well as improve the mechanism of tax collection and administration. And in the long term, Form sufficient stability of the financial mechanism, promote the rational flow orderly through resource elements and realize the equalization of public service objectives between the Province’s and city’s government.