Research On Exit Tax System

It is common that tax jurisdiction over resident is generally adapted as the basis of exercising the right of imposing taxes by countries around the world,and the status of resident individual as connection point of taxation.Grounded on tax jurisdiction over resident,a resident individual shall pay individual income tax on his or her income obtained inside and outside the country,while a nonresident individual shall pay individual income tax on his or her income obtained inside the country.The different provisions concerning tax treatment between resident individuals and nonresident individuals,taxpayer’s economic motives to shirk unlimited tax liability were sprang,and the purposes might have achieved by transforming taxpayer’s identity of resident individual in home country.For lowering the adverse impact on tax revenue,numerous countries have continuously introduced exit tax.Exit tax is considered to be introduced in China in this thesis,in the light of a huge amount of emigration at the background of China as the fourth largest source country of emigration in the world.The influences of emigration include direct effect of the loss of the tax base and indirect effect of the challenging of tax sovereignty.Introduce exit tax in China would serve the function of consolidating tax base,increasing tax revenue and maintenance of China’s tax sovereignty.First of all,in the introduction the related concepts of exit tax and the analysis the essential legitimacy of taxation of unrealized gains and mark to market,exit tax is pertain to income tax system rather than a tax category in this thesis,and is based on the principle of tax sovereignty,principle of tax equity and principle of safeguarding state sovereignty and economic interests.Secondly,large-scale emigration has a negative impact on China’s economy and society.The establishment of exit tax is conducive to curbing asset outflows,combating tax evasion and tax avoidance,perfecting system of tax collection administration,and cultivating the awareness of nationals to comply with the tax law and to pay tax according to law.Thirdly,there are rules and regulations on expatriation and anti-tax avoidance at tax law in China.It is not a castle-like illusion to introduce exit tax in China,but a certain legal basis.Fourthly,through the analysis of the current situation of introduction of exit tax in China,the obstacles consist in the lack of detailed provisions on the procedure of renunciation of nationality in the constitutional law department,the imperfection of personal property registration and evaluation system and income monitoring system in practice,and the faulty system of third-party information sharing and international exchange in information.Fifthly,comparing the exit tax and fee system concerning exit tax,re-entry charges and extended tax liability,experience reference to introduce exit tax is provided in the future in China.Finally,it puts forward countermeasures and suggestions for the construction of exit tax in China,mainly including three aspects.Firstly,it should follow four legislative ideas,supplementing and improving the direct tax system,not increasing the additional tax burden,compensating the cost of policy and resource consumption,respecting reasonable personnel and capital flow.Secondly,individual is one of the taxpayers of exit tax who transformed resident individual to nonresident individual,and meet the property threshold or tax obligations or emigration tax avoidance judgment,shall be taxed on all property according to the tax elements of individual income tax.Thirdly,revising the relevant provisions of the tax law and the constitutional law,and improving the mechanisms of property,audit,coordination and intermediary,not only the legal and practical base of exit tax would be laid,but also the tax environment in China could be improved.