A Study Of The Influence And Strategies On The Construction Industry Of The Transform From Business Tax To VAT

Replacing Business Tax with VAT has important significance in dealing with businesstax double taxation problem, improving the existing tax system, promoting structural taxreduction, transforming the mode of economic development and optimization andupgrading of industry. The tax reform was introduced during the period of“Twelfth-Five-Year” and played an important role in the reform of consumption typevalue-added tax.The pilot program introduced from November16,2011. Transportation industry, partof the modern service industry, railway transportation industry, postal services industryand telecommunications have been brought into the reform of replacing Business Tax withVAT in succession. The construction industry is temporarily not included in the nationalpilot. This policy will be implemented in the whole national before2015. With thedevelopment of the market economy the China’s construction industry is expanding at alow level, and it still in the preliminary developing phase. While the tax collecting patternis becoming one of constraint factor related with its development. Such as double taxationproblem and heavy tax burden problem. The implementation the policy of the ReplacingBusiness Tax with VAT mainly devote in eliminating restriction and promote the healthydevelopment of the construction industry. Then the lack of necessary policy may have beenblocking the progress of replace business tax with value-added tax.This paper mainly research in the extent of VAT and in the case of constructionindustry. The purpose lies in clarifying the influence and troubles on construction industryproduced by the Replacing Business Tax with VAT. Some rationalization proposals areraised in order to smooth the path of reform.The dissertation consists of six parts:The first part is introduction. This part introduces the background and significance ofthe research, summarizes literature, points out the methods, ideas, innovation anddeficiency of the research. The second part refers to related theory including the tax neutraltheory, the theory of optimal taxation and the fair taxation theory. The third part analyzedthe situation about the progress of the Replacing Business Tax with VAT and someproblems of the exiting tax policy. The fourth part discussed the tax burden and the effect on the financial and management induced by the Replacing Business Tax with VAT in thecase of a company. The fifth part provide some suggestions about how to solving the aboveproblems. The sixth part summarizes the dissertation.