Research On The Impact Of Tax Reduction On Bus Manufacturing Enterprises

At present,China’s economy has shifted from the stage of high-speed development to the stage of high-quality development,focusing on structural adjustment and industrial upgrading,but the problem of unbalanced and insufficient development remains prominent.At the same time,uncertainties in the international situation have increased,and the COVID-19 pandemic has also had a negative impact on economic development,China’s economic pressure is increasing day by day.In this context,General Secretary Xi Jinping proposed to deeply understand the new development stage,comprehensively implement the new development philosophy,focus on building a new development paradigm,and add impetus to China’s economic development by prospering the domestic economy and unwinding the domestic and international double circulation.In order to reduce the burden of production and operation of enterprises in China,stimulate the vitality of micro-entities and promote high-quality economic development,the government has continuously reformed the tax system and introduced a series of tax reduction policies.With the change of business tax to VAT in 2016 as an important representative,China’s tax reduction has only increased since then,and there is still room for optimization while achieving certain results.The automobile manufacturing industry occupies an important position in China’s economy,and the bus manufacturing industry,as a part of it,has been developing poorly in recent years.This thesis takes the corporate income tax and VAT reduction policies as the starting point,and selects Yutong Bus as the case enterprise to study the specific impact of tax reduction policies on micro enterprises,so as to better test the actual effect of tax reduction policies and provide suggestions for the future development of bus manufacturing enterprises and the improvement of the new round of tax reduction policies.This thesis deduces the transmission mechanism of tax reduction policy affecting corporate performance through theoretical analysis: the implementation of tax reduction policy leads to the reduction of taxable amount and tax burden,thus positively affecting corporate cash flow and net profit,further improving corporate financing,investment and R&D,and finally achieving the effect of improving corporate performance.On this basis,this thesis uses the annual reports of Yutong Bus from 2015 to 2020 as the main source of information,and conducts research along the logical sequence of theoretical elaboration,policy combing,mechanism analysis,case study,and policy recommendation,and draws the following conclusions: first,the implementation of the tax reduction policy does reduce the overall tax burden of Yutong Bus,resulting in more free cash flow and an increase in corporate after-tax profits.The tax reduction effect of corporate income tax is more pronounced than that of VAT,and VAT accounts for a disproportionately high share of the overall corporate tax bill.Second,Yutong Bus’ fundraising,investment and R&D are all affected by the tax reduction policy to the upside,and the combined effect of all three has an impact on the improvement of corporate performance.Thirdly,the tax reduction policy has improved the solvency of Yutong Bus to a large extent,and also has a certain impact on the profitability and development ability of the enterprise,but has little effect on the improvement of the operating ability of the enterprise.Fourth,Yutong Bus’ use of the tax reduction policy is very effective,and although there is a problem with the division of R&D expenditures not being reasonable,it is still worth learning from other bus manufacturing companies in other aspects.Therefore,the thesis is divided into three levels in making policy recommendations.First,at the enterprise level,it is recommended that Yutong Bus clearly delineate the research and development stages of R&D activities,conduct market research to speed up inventory turnover,adjust corporate development strategies and actively expand international markets;second,at the industry level,it is recommended that other bus manufacturing enterprises learn from Yutong Bus and maximize the effectiveness of tax reduction policies by increasing R&D investment and changing the depreciation methods of fixed assets;finally,at the government level,it is recommended that the government should lower the statutory rate of corporate income tax,promote the systematic development of preferential corporate income tax policies,continue to simplify and lower the VAT rate,and improve the VAT retention credit refund policy,while continuously optimizing the business environment for enterprises.