van der Hoek, M. Peter and Kong, Shuhong and Li, Zhenzi (2008): The dual corporate income tax in China: the impact of unification. Published in: Public Finance and Management , Vol. 8, No. 4 (2008): pp. 655-677.
Download (103kB) | Preview
For many years, foreign funded companies in China enjoyed a relatively low tax rate and a series of preferential policies which were aimed at encouraging foreign direct investment in China. By adopting a new law in 2007, however, the National People's Congress proclaimed the end of the dual corporate-income-tax system. From 2008, the preferential tax treatment of foreign capital will be phased out. As a result, the income tax rate for domestic and foreign funded companies will be unified at the rate of 25%. This paper explores the impact of the dual corporate income tax system on both domestic and foreign funded enterprises and discusses the possible effects of the unification.
|Item Type:||MPRA Paper|
|Original Title:||The dual corporate income tax in China: the impact of unification|
|Keywords:||dual corporate income tax, China, unification, foreign funded enterprises|
|Subjects:||H - Public Economics > H2 - Taxation, Subsidies, and Revenue > H25 - Business Taxes and Subsidies|
|Depositing User:||M. Peter van der Hoek|
|Date Deposited:||13. Nov 2008 04:19|
|Last Modified:||11. Aug 2015 00:47|
An, Tifu (1999) Study on Tax Burden, China Financial and Economic Publishing House.
Beijing Local Taxation Bureau The First Bureau (2007) Inspirations of the Income Tax Reform in Other Countries to the Unification of Dual Corporate Income Tax in China, http://jicha1.tax861.gov.cn/index.htm.
Chen, Fuwen (2003) “On the Fairness of Corporate Tax”, China Western Technology, No. 5, pp. 89-90.
Cheng, Qingshong (2003) Analysis on Income Tax Impact and System, Xiamen University, PhD thesis.
Gao, Jingjuan and Jiang, Xiujuan (2006) “On China's artificial foreign capital phenomenon”, Special Zone Economy, Vol.11, No.49, pp.131-132.
Hao, Cunhong (2001) “Analysis on Excess Tax Burden”, Tax and Economy, Vol. 4, No.12, pp. 86-90.
Hu, Xiaohui and Wang, Lujin (1992) “Study On China's Overall Tax Model”, Quantitative and technical-economic studies, Vol. 12, No. 15, pp. 56-59.
Liu, Tao (2003) Empirical Research On China’s Tax Burden And Discussion On Tax Policy, Chongqing University master's degree thesis.
Lotz, Joergen R. and Morss, Elliot R. (1967) “Measuring Tax Effort in Developing Countries”, IMF Staff Papers, Vol. 10, No. 3, pp. 78-82.
Ma, Jianping (2004) Suggestions On Tax Fairness Promotion In Foreign-Funded And Domestic-Founded Companies, Jinan University master's degree thesis.
Sichuan Provincial Finance Department (2002) Analysis on Corporate Tax Burden in 2000, Tax Regulation Division, Sichuan Finance, No. 5, pp. 40-42.
Wang, Chengyao (1995) “The Unification of Two Income Tax Policies”, Tax Study, Vol. 35, No. 12, pp. 7-16.
Wei, Tong (2000) “Empirical Analysis on Tax Burden of Chinese Corporatist”, Central Financial University Journal, Vol. 1, No. 12, pp. 34-37.
Whalley, John and Wang, Li (2007) The unified enterprise tax and SOEs in China, NBER Working Paper 12899 [http://www.nber.org/papers/w12899].
Wu, Junpei, and Zhang, Qing (2003) “The Optimal Reform Path For China Tax Reform - Optimal Revenue And Policy Model”, Tax Study, Vol. 12, No. 3, pp. 7 -13.
Wu, Zhaoying (2002) Studies On FDI Tax Policy, Xiamen University Master Degree Thesis.
Yang, Zigang, Ding, Lin and Hao, Binzhen (2000) “Empirical Study on the Value-Added Tax and Corporate Income Tax Burden”, Economic Research, Vol. 12, No. 8, pp. 26-35.
Zhang, Xueyan (2006) “Tax Burden after Two-Income Tax Unification and Impact on Foreign Investment”, China Development Watch, September 30, pp. 56-59.