Tax Benefits Of The Theory And Practice

The topic of this paper is about tax incentives. As we know now, it is undoubtful that most of the world countries use kinds of tax incentives to promote fast increase of their economy and harmonious development of their societies .It is uneasy to appraise the effect of the world's using tax incentives in conclusion of favourable or unfavourable results, because different situations and different economical stages of different countries ask for different policies of tax incentives, so that tax incentives can have different impacts on the countries' economy and societies. Since our reform and opening to the world, our government has utilized a mass of tax incentives to stimulate economic increase and development. With several times' reform of the tax system, the policies of tax incentives have been adjusted. While these policies produced positive effect on the development of our country's economy and society, their abuse has become more and more evident. The public voice has appealed innovation on actual policies of tax incentives for a long time, but no coherent opinion has been available as yet, and even there is suggestion on abolishment of tax incentives. Because such dispute has straight influence on the government's choice of polices in its macroscopical regulation of economy and society, it will bring out important realistic significance to constitute rational and effective tax incentives, to perfect the tax control system and to fully exert its function that we make proper cognition on the theoretic reason of tax incentives' existence and their effect.Apart from the preface, the paper includes two parts with five chapters.Part One:This part includes three chapters. In this part, tax incentives are analyzed theoretically. The first chapter gives research on the theoretic reason for tax incentives' existence and their basic functionary principles in market economy. This chapter demonstrates the necessity oftax incentives from market economy, and gives basic analysis to their principles from different facets. The second chapter gives research on concrete functionary mechanism of tax incentives from their means and modulatory objectives. The third chapter discusses rational limit to tax incentives, which demonstrates that as a special manner to modulate economy and society, tax incentives have inherent and impersonal localization in theory, so that they can produce a series of negative domino effect in practice, and governments must hold a reasonable degree when they utilize tax incentives to exert impact on the course of economy and society .Part Two:This part includes two chapters. In this part, tax incentives are analyzed positively. The fourth chapter gives research from the practice that tax incentives give birth to different effects which are used by the world countries on the base of special developing stage, and come to a conclusion that while tax incentives have the necessity of existence, they must be limited to a rational degree. On the base of above analysis, this chapter also shows the world's trend of tax incentives. The fifth chapter firstly treats with the total influence of our country's tax incentives, and brings forward to basic and concrete proposals on how to perfect tax incentives.The innovation of this paper lies in its putting forward to and trying to illustrate the two types of impersonal localizations of tax incentives, —one, the localization of internal restriction and another ,that of governmental limitation. The former refers to the one resulted in by internal restriction to functionary mechanism of tax incentives and by unharmony of the other contents of the tax system. This localization is impersonal, and mainly affect the choice of incentive objective, functionary location and design and estimate of functionary intensity. The latter refers to the one that was induced by the warp arising in determination on tax incentives due to governmental limitation and by the distortion or decline of efficiency whilepolices of tax incentives are brought i...