Abstract: Under the condition of market economy, reducing corporate tax burden is an important means to improve the competitiveness of enterprises. How to reasonably plan the various taxes of enterprises within the scope permitted by national laws and make the tax burden of enterprises the lightest has become one of the most critical issues facing enterprises at present. This paper expounds the necessity and feasibility of tax planning for Chinese enterprises and many factors that should be considered.
With the formation of world economic integration, global competition is becoming increasingly fierce, especially after China's accession to the WTO. If our enterprises want to survive in such an environment, they must have their own unique competitive advantages, and the formation of competitive advantages is mainly achieved by reducing costs and segmenting markets. As the main source of enterprise cost, various taxes have an important impact on the accounting income and the realization of enterprise goals. At the same time, countries in the world have different policy tendencies in economic development, and there are great differences in tax policies in different regions and industries, which provides broad space and conditions for tax planning.
The so-called tax planning refers to making a tax operation plan by planning the tax business in advance, so as to achieve the purpose of tax saving and maximize the after-tax profit. Objectively, it has the purpose of "realizing tax payment at the latest, taking the lightest tax, narrowing the applicable tax base, enjoying the most tax rights, minimizing the penalty risk and optimizing the tax payment cost". The emergence of tax planning is a sign of tax progress, an inevitable phenomenon of economic development to a certain stage, and a compulsory course for enterprises.
First, the necessity of tax planning:
At present, it is difficult to carry out tax planning in China, and there are not many tax planning in a strict sense. There are two main reasons: first, the leaders of many enterprises have not realized the importance of tax planning, and the concept and operation of tax planning are still very strange; Second, the standardization of China's tax law is poor and difficult to grasp. Moreover, the research on tax planning in China is superficial and there are not many formed theories. Most of the tax planning books published now introduce a model, and most of its theories and skills are foreign, that is, the so-called "international planning", which is less applicable to China's tax law and less operable. In addition, the misunderstanding of tax planning by public opinion, especially some tax authorities, has also hindered the normal development of tax planning to some extent. This requires enterprises to have a correct understanding of the necessity of tax planning.
1. From the trend of internationalization of enterprise competition, tax planning has become the focus of "reducing expenditure".
After China's entry into WTO, Chinese and foreign enterprises will compete in a more open and fair environment, and whether they can reduce costs and increase profits is the key to success. The financial mechanism of foreign enterprises has been relatively mature and stable, and various tax planning methods can reduce the overall tax burden of enterprises, which is equivalent to improving the profit level. In the current increasingly fierce market competition, it is quite difficult for enterprises to expand their market share through "open source", that is, marketing means. If China enterprises want to compete with foreign enterprises on the same stage, they should focus on "reducing expenditure", that is, controlling internal financial costs. Tax expenditure is an important part of financial cost, and how to control tax expenditure through tax planning is very important for enterprises.
2. Facing the current domestic tax legal system, reasonable tax avoidance is inevitable.
At present, the taxpayer's tax burden is too heavy, and it is the only choice for enterprises to reduce the tax burden through tax planning. When taxpayers face a heavy tax burden, and the current tax legal system cannot be changed in a short time, the tax burden faced by taxpayers is very high, which encourages taxpayers to choose tax evasion to some extent. But its illegality doomed this kind of behavior to be a "dead end". If taxpayers have adverse selection behavior, negative treatment and reduce the scale of economic activities, they can only be eliminated by market competition in the end. Only through tax planning can we realize reasonable tax avoidance. This is an inevitable move for enterprises to meet the challenge of WTO and face the current policies and regulations.
3. From the internal financial mechanism of enterprises, tax expenditure should be controlled.
The cost of an enterprise can be divided into two categories: internal cost and external cost. All period expenses, salary expenses, etc. The tax expenditure of an enterprise belongs to the internal cost, while the tax expenditure belongs to the external cost of the enterprise. At present, there is a wrong idea in enterprises that controlling costs means controlling internal costs, while treating corporate taxation as inevitable and not controlling it. In fact, the control of internal costs is already quite strict. Excessive compression of internal costs may cause negative consequences such as the loss of employees' enthusiasm and affect the development of enterprises. Therefore, while controlling internal costs, we should try our best to save the external costs of enterprises and pay equal attention to both internal and external costs.
Second, the feasibility of tax planning
As a protection of taxpayers' economic interests, tax planning is absolutely necessary, but the implementation of tax planning must be based on a certain economic environment and supporting measures. At this stage, the feasibility of enterprises as taxpayers to implement tax planning is mainly manifested in:
1. As an important economic lever of the government's macro-control, taxation provides a broad development space for tax planning.
In real economic life, taxation is not only the main means for the country to obtain fiscal revenue, but also has the function of macro-control. In order to encourage taxpayers to act according to their own wishes, governments all over the world regard the implementation of differential tax policy as an important means to adjust industrial structure and stimulate national economic growth. The government embodies macro-control policies by setting taxes, determining tax rates, selecting tax targets and tax links. The application of tax as a means of adjustment in economic practice makes the tax burden always different among different taxpayers, different tax payment periods, different industries and regions, no matter how perfect and strict the tax system is, which provides great possibilities and more opportunities for taxpayers to make tax planning and reduce the tax burden. Through the research and understanding of national tax laws and policies, taxpayers must choose economic behaviors encouraged or advocated by the state and organize production and business activities to maximize after-tax benefits. In this sense, tax planning is essentially the product of tax laws and policies treated differently by the state.
2. The flexible space of tax system provides many possibilities for tax planning.
In economic practice, taxpayers' economic activities and modes of operation are varied. Facing all kinds of taxpayers, the national tax system should be relatively fixed and flexible. The existence of this institutional flexibility also provides taxpayers with many opportunities for tax planning. Shown in: (1) taxpayer's flexibility. Specific taxpayers pay specific taxes and enjoy specific preferential tax policies. Taxpayers can make some changes in their taxpayer status through some special business activities, so as to reduce their tax burden or avoid their tax obligations. (2) Scalability of tax base determination. On the premise of fixed tax rate, the determination of the amount of tax object directly affects the size of tax. Therefore, taxpayers can adjust the number of tax objects as much as possible within the scope permitted by the tax law, thus reducing the tax base and tax burden. (3) Tax rate difference. On the premise of a certain number of tax objects, the higher the tax rate, the heavier the tax burden, and vice versa. This close relationship between tax rate and tax burden will inevitably urge taxpayers to avoid high tax rate as much as possible and seek low tax rate. It provides taxpayers with an opportunity to avoid high tax rates.
3. The diversity of accounting methods provides an important technical means for tax planning.
The planning of various taxes in China is closely related to the choice of accounting treatment methods, especially in the planning of income tax, which is most obviously affected. There are many ways of tax planning, among which the tax planning related to the choice of accounting treatment methods is mainly to narrow the tax base and postpone tax payment. If the tax law does not clearly stipulate the taxable income of taxpayers, the provisions and methods of the accounting system shall generally apply. However, in accounting, there are a lot of professional judgments. Different professional judgments will choose different accounting methods and form different tax basis, thus affecting the tax burden of taxpayers. For example, the depreciation of fixed assets is an important part of the cost, which can offset the income tax. Using different depreciation methods, the amount of income tax deduction in each period will be different. Depreciation is accrued by the straight-line method, and the depreciation amount of each period is relatively fixed. However, the accelerated depreciation method, that is, the double declining balance method or the sum of years method, will have a large depreciation in the early stage and a small depreciation in the later stage when the depreciation period remains unchanged. Because of the time value of funds, the accelerated depreciation method can delay the tax payment to the later period because of the increase of depreciation in the previous period, which is equivalent to obtaining an interest-free loan from the state according to law. Similarly, taxpayers also have certain options in the selection of inventory valuation methods, bond surplus and discount amortization methods, income settlement methods and bad debt accounting methods. If it can be used flexibly, it can achieve the purpose of reasonable tax reduction or tax extension.
Iii. Factors to be considered in tax planning
The premise of tax planning for enterprises is that the accounting policies and accounting estimation bases they choose must comply with national laws and regulations, and consciously abide by accounting standards and accounting systems. In addition, the following factors should be considered:
1. Enterprise development strategy
The direct goal of formulating enterprise development strategy is to maximize after-tax profits, and the ultimate goal is to maximize enterprise value. In this process, we should comprehensively consider the influence of many factors, and tax cost is only one of them. The choice of accounting policy and the determination of accounting estimation are only a means to complete the development strategy of enterprises. Sometimes, reducing current tax revenue and delaying tax payment may run counter to the development strategy of enterprises. In this case, the tax planning of enterprises should be considered from the height of development strategy and guided by the overall strategy of enterprises. If we only consider it from the perspective of tax planning, it may make partial profits and harm the overall interests of enterprises.
2. Enterprise related costs
Successful tax planning will increase the economic benefits of enterprises, but sometimes it may bring or increase additional costs to enterprises, such as transaction costs and information costs. Enterprises should conduct cost-benefit analysis in tax planning to judge the feasibility and safety of the planning scheme. Only when the income is greater than the cost can it be economically feasible. The cost to be considered should not only include obvious human, financial and material costs; It also includes the opportunity cost lost due to tax planning. Therefore, in tax planning, it is necessary to weigh the tax revenue and related costs, conduct cost-benefit analysis, and then choose the best tax payment scheme.
3. Recognition by tax authorities
Enterprises should deal with tax collection and management departments in tax planning. In practice, many tax planning behaviors have evolved into tax evasion. One of the most important reasons is that enterprises and tax departments have different ways of tax planning and understanding of laws and regulations because of different angles. Therefore, it is necessary for enterprises to strengthen contact and communication with tax collection and management departments, get their approval when dealing with some vague and new things, and avoid unnecessary differences in tax planning. Through contact and communication, we can also understand the investigation of relevant tax policies and the information of new policies, so as to strengthen the accuracy of tax planning and forecasting and help enterprises obtain greater benefits.
References:
[1] Zhang Han: Discussion on tax planning of central enterprises in China in the new period (j) Modernization of shopping malls,No. 1, 2005.
[2] Lin et al. Analysis of the present situation of tax planning for small and medium-sized enterprises (j) Accounting Monthly (Comprehensive), No.8, 2005.
[3] Yue Xiyu: Mistakes and Solutions of Tax Planning for SMEs (j) "Coastal Enterprises and Technology",No. 12, 2006.