Study On The Influence And Countermeasures Of Replacing The Business Tax With Value-added Tax On Financial Performance Of Construction Enterprises

Replacing the business tax with value-added tax(VAT),as an important part of deepening of fiscal and taxation reform,affects the development of the overall economy,and is also an important measure to promote the supply-side structural reform of China.The construction industry has a significant impact on the national economic development and national construction,and is one of the driving forces of the economic development.From May 1,2016,the construction industry has been added to the pilot scope.Paying the business tax will be changed to pay the VAT.However,how does the reform of business tax affect the financial performance of construction enterprises? How can the construction enterprises find the opportunity to cope with the impact of the tax reform to improve their financial performance and fully enjoy the reform benefit? This is an important theoretical and practical question to answer.In this paper,relevant tax theories and financial theories are used to study the impact of the tax reform on the financial performance of construction enterprises,and indicate countermeasures and suggestions for improving the financial performance of construction enterprises.On the basis of others research results,this paper summarizes the theoretical basis of the research,analyzes the theory and the impact on the financial performance of construction enterprise,and finally makes a conclusion at the coping strategies.In this paper,it is found that the value-added tax can increase the profits of construction enterprises and make the operation and management of construction enterprises more standardized and efficient.However,due to the inadequate coping ability and low management level of the construction enterprises,their financial performance has some negative effects,such as the turnover tax burden fluctuates,the taxes and fees occupy more funds,the accounting is more complex,the enterprise accounting level increases slowly,excessive pursuit of the policy is deducing,fixed asset investment deviates from actual demand,the contract price increases greatly,the traditional project operation mode needs to be improved,solvency and increased funding activities is declining,many financial indicators have been fluctuated,enterprises are under greater pressure.This paper holds the view that many measures must be taken to help the constructionenterprises better adapt to the policy of the reform,get through the transition period and improve their financial performance.Firstly,construction enterprises should enforce tax planning and reduce their tax burden.They should improve the deductible ratio of building materials,labor costs and fixed assets,arrange the collection time flexibly,minimize the amount of advance payment to reduce the prepaid tax.These strategies could maximize the utilization of the deduction policy,reduce the tax cost of the capital assets.Secondly,they should make promotion at the same time to improve the accounting level.They should strengthen personnel training and assessment to promote the professional quality of accountants,optimize process management,strengthen internal control,and improve the level of accounting comprehensively.Thirdly,construction enterprises should strengthen project management and prevent major risks.They should improve the contract conclusion,strengthen the management of the contractor,and forbid the illegal subcontracting.In order to improve the pricing power of the contract,they should strive for material supply rights.They should strengthen invoice management to avoid tax risks.Finally,they should make flexible developments of management strategies to improve financial indicators.They should take an active part in the construction of public infrastructure,improve the ratio of assets and liabilities,increase liquidity and solvency,and reduce operational and financial risks.