Comments On The Tax Processing Decision Case Of Dashan Company V.Suqian City Local Tax Bureau Inspection Bureau

Land value-added tax is an important tax formulated by the state in a unified way.It is reasonable that the various elements of land value-added tax should be regulated by the state in a unified way.However,as a tax which is collected and managed by the local tax bureau and mainly belongs to local fiscal revenue,in the process of implementation,it is difficult to avoid showing the characteristics of different calibers of implementing tax laws and regulations in view of the complexity of real estate development projects and the price differences in real estate markets.To a certain extent,this has led to increasing disputes in tax administrative litigation concerning land value-added tax.“Dashan Company Case”,”Oubo Company Case”,”Ruicheng Company Case”,”Yingcheng Company Case” are the typical legal disputes.“Dashan Company Case” as the Main Case has experienced administrative reconsideration,first instance and second instance judicial procedures,and the parties of tax and enterprise have had considerable differences and disputes in many aspects.We can see that the two parties in this case mainly have the following five substantive disputes:first,whether the receivables should be recognized as sales income;second,how to confirm the taxable price of real estate investment abroad;third,how to determine the saleable building area on the underground floor;fourth,whether the reward of land transfer fee should be deducted when confirming the land price.Fifth,whether the interest of borrowing from non-financial institutions can be directly included in the development cost.According to the provisions of laws and regulations as well as relevant tax collection policy documents,receivables are recognized as sales revenue in accordance with the accounting standards of enterprises and tax laws;the value of real estate investment is assessed by the Inspection Bureau in accordance with the methods and order prescribed by the Tax Law;the size of the saleable building area of the underground floor determined by the Inspection Bureau is not inappropriate;the reward of land transfer fee should be deducted when land price is confirmed.Dashan Company's interest on borrowing from non-financial institutions can not be directly included in the cost of real estate development,and should be deducted in accordance with the provisions.In order to effectively reduce the disputes between tax and enterprise in the liquidation of land value-added tax in practice,China's land value-added tax system should be improved from the aspects of "implementing thelegal principles of taxation,standardizing deduction items,reasonably designing tax rates and improving communication mechanism",in order to further standardize tax collection by tax authorities according to law,promote taxpayers to pay taxes according to law,and help to build a harmonious relationship between tax and enterprise.