Research On The Improvement Of Tax Incentive Legislation For Venture Investors In China

Legal system of tax incentive for venture investors of China has taken shape,and has achieved remarkable results in promoting venture investment and increasing the success rate of start-up enterprises.Among them,stipulating the principles and rules of tax incentive by combining different levels of tax law and tax policy,make the system not only authoritative,but also flexible.However,while stipulating the tax incentive by combining law and policy,we ignore the following questions as such:Using tax policy that modified frequently to stipulate tax incentive,makes it violate the tax statutory principle,and reduce the tax stability and predictability for investors;establishing the tax law status just for venture capital companies,but not for the other kinds of venture investors,makes it violate the tax fair principle;different kinds of investors can't get same tax incentive for the same investment,also shows the violation of tax fair principle;the identification standard of start-up technology enterprises which is strict and simple,can't meet the goal of targeted regulation.Therefore,by referring to the legislative experience of countries with developed venture capital industry and combining with legislative practice of China,this paper puts forward the following suggestions:Firstly,improve the tax incentive legal system in accordance with the tax statutory principle.On the basis of improving relevant laws,the form of tax incentive should be adjusted from the policy to the "interim measures",and the tax incentive should be added for reinvestment.Secondly,lower the tax incentive threshold.Set differential investment deduction rate for the investors of start-up technology enterprises,relax the restriction on investment methods,from cash to cash and transferred equity,and balance the tax base of pre-tax deduction for three kinds of venture investors.