| The recent years have seen a large number of urban laid-off workers and the laborers who have moved from rural areas to urban areas have found jobs in the informal sector with relatively low entry barrier during the course of urbanization and the deepening of state-owned enterprise reform.The informal economy has played a positive role in helping market expansion,providing employment opportunities for limited-capability-workers and enabling low-income families to earn their living.On the other hand,some issues,such as the larger scale of the informal economy and the distortion of resource allocation,have been increasingly clear.So it also poses challenges to the informal economy.The informal economy contains a large number of economic activity subjects involved in unregistered,cash or even barter transactions.Whether and howto tax the informal economy is an important topic for all countries around the world.The taxation on the informal economy has higher cost,is hard to benefit the small-scale economic activity subjects,and is uncertain about the final destination of the tax burden.From a horizontal equity perspective,despite the situation above,low-income groups in the formal sector who are required to pay tax suffer worse condition than those in the informal sector who have the same income but do not have to pay tax.Wage earners in developing countries usually pay more taxes than those self-employed labours who have the same income.From the perspective of national governance,introducing the main body of economic activities in the informal sector into the tax network will not only help improve the level of tax compliance,but also promote the improvement of government public service and management responsibility,and thus make more contributions to state governance.Therefore,effective taxation of the informal economy has become a subject of great concern to us.The article defines the definition of the informal economy and estimates the scale of the informal economy in recent years.This paper analyzes the problem of informal economy taxation comprehensively by the method of combining theory and practice,So as to provide some more enlightening and referential policy suggestions for the tax administration of the informal economy in China.The article is divided into eight chapters to discuss the issue of the informal economy taxation.The first chapter is introduction.This chapter mainly provides a high-level introduction to the topic of "Informal Economic Taxation",Concentrating on a few respects:the background and significance of the study,the present status of the informal economy scale as well as taxation research at home and abroad.This paper mainly deals with the research status of three kinds of research on the method of estimating the scale of informal economy at home and abroad.In addition,according to the different attitudes of foreign scholars on informal economic taxation,they are classified into three types.On the basis of the summary of the existing literature,the current status of the research is reviewed.The second chapter defines the concept and type of informal economy and its scale in China.The informal economy is not a conventional concept,it has evolved with changes in the economic form.Therefore,there are some related or similar concepts in the previous literature.This chapter distinguishes between similar concepts such as the black economy,the underground economy and the economy that is difficult to tax.And then defined the informal economy as various economic activities separated from tax regulation,as per the research content of this article.According to the order of decreasing strength of informal production and business activities,the informal economy is divided into three categories.Namely,the total informal economy,the marginal informal economy and the iceberg-type informal economy.The main object of this article is the small and micro enterprises which obtain sufficient income to pay taxes,but are easy to escape the sight of the tax administration department,or hide most of the tax burden because of their location,size and nature of the enterprises.By analyzing the merits and demerits of the methods of monetary analysis,multi-index multi-factor model,material law and revenue and expenditure difference model,we select currency analysis as the method of evaluating the informal economy in this paper.After using China data to verify the estimation method,We make an estimate of China's informal economy and get its scale figure over the past decade.The third chapter is the theoretical analysis of the informal economy taxation.From the perspective of fiscal revenue,taxation of the informal economy provides the government with an important source of potential revenue.Because the informal economy's share of GDP plays a significant role,especially for the developing countries,the informal economy takes a higher proportion.This has also been verified in China's estimation of the informal economy scale.From the perspective of resource allocation,informality has avoided certain costs for the main subject of the economic activity,In the meanwhile,it also prohibited some shared opportunities with the formal enterprises.As a result,it still needs more empirical results to verify the impact of informal economic taxation on economic efficiency.In terms of income distribution,taxation of informal economic activity entities is a form of horizontal fairness for low-income groups who must pay taxable income in the formal sector.Through the analysis of the general equilibrium effects of products or elements,we concluded that the effect of tax revenue distribution on the informal economy should depend on the final destination of the tax burden.In regards to state governance,introducing the main subject of economic activity in the informal sector into the tax network and improving the accountability of the government will undoubtedly achieve more indirect benefits at the national governance level,The taxation of informal economy will greatly influence the construction and improvement of tax compliance culture.The fourth chapter is an empirical investigation of the taxation on the formalization of the informal economy.The data in this chapter come from the field survey of small and micro enterprises in Liaoning Province,Samples of the survey are stratified sampling according to the industry,the main economic activity is selected as the dependent variable,the main subject of economic activity is selected as the independent variable,the informal loans for economic activities,the scale of economic activities,the main operating income of economic activities,and the main areas of economic activity are the control variables.Using panel data to establish a fixed effect,random effects model.Via the analysis of statistical results and regression results,it is concluded that taxation has a positive effect on promoting the formalization of the informal economy.The fifth chapter is he influencing factors of informal economic tax compliance.This chapter takes the informal economy as the research object,On the basis of the classical A-S model,the optimal solution is obtained for the expected utility equation of the taxpayer's declared income.And analyze the effect of actual income,proportional tax rate,penalty ratio and inspection probability on taxpayer's declared income.This chapter draws on domestic and foreign scholars' research on tax compliance,Using the similarities between the nominal profits and the projected profits,describes the degree of tax compliance of the informal economic subjects,Based on the sample data,the relationship between tax rate,tax regulation and tax compliance of informal economic activity subject is examined.Through multi-model regression analysis,we found that the higher the actual income tax rate for non-economic activity subjects,the lower the level of their tax compliance,and the higher the level of compliance for those who had been subject to tax punishment.The sixth chapter analyzes the cost-benefit of informal economy tax management.The costs and benefits of the informal economy are not directly available,so we used an indirect method to analyze the cost-benefit of informal economic tax administration in this chapter,including two methods:the marginal benefit cost method and the tax evasion controllable estimation model.The Fund's marginal benefit cost method is established based on the expected reward of the investigator's time investment in the audit process,Tax compliance is seen as a series of decisions between taxpayers and tax managers.These results are based on cross-sectional delineation and thus estimate the marginal return expectations of unit management costs.Tax evasion controllable estimation model can more clearly highlight the factors affecting the incidence and extent of tax evasion,and effectively control the audit process and monitor its possible flaws.From the regression results of the model,it can be concluded that past audit results have a deterrent effect on non-compliance,Under the control of individual differences and the selection process of the sample,the taxpayers who had been examined were higher than those who had never been examined.That is,the tax management of informal taxation has increased.It is good for tax revenue increase.The seventh chapter compares the main methods of the informal economy.This chapter mainly elaborates four types of informal taxation methods.That is,presumed taxation,a separate tax,involvement of third-party authoritative organizations and government consultation and indirect taxation law.Among them,the first three are direct tax methods,commodity tax law is a method for indirect tax.According to the more effective presumed taxation methods implemented by developing countries and transition countries in recent years,deviding the presumed taxatation roughly into contractual contract law,the percentage of total revenue and quantitative assessment of the law,and then analyze their advantages and disadvantages.Based on the simple tax system of Ukraine and Russia,the advantages and disadvantages of the simple tax system are analyzed from the aspects of applicable standards,right to defense and effectiveness.Involving third-party authority organizations is a more flexible method of presumption taxation.Determinants of intervention in third party organizations are analyzed from five aspects:the financial pressure,the nature of third-party institutions,the standardization of consultation processes,the political factors of the central and local governments,and the state tax and resident obligations.The indirect taxation law imposes taxes on products and services purchased and sold,although in most cases the informal sector economic activity subjects do not initiate tax registration on their own initiative,they are taxed on the purchase of products and services in the value chain,thereby reducing the difficulty of tax collection and management.Through the analysis of the presumption taxation method and China's tax environment,it provides ideas for exploring China's presumption taxation method.The eighth chapter puts forward some suggestions on how to perfect the taxation of informal economy in China.This chapter combines previous analysis of the size of the informal economy in China,the factors affecting tax compliance,the cost-benefit of informal taxation,and taxation methods,proposing Policy Suggestions for Perfecting China's Informal Economy Taxation from the aspects of improving the informal economy taxation method and the modernization of tax collection and management,and raising the level of tax compliance.From the point of view of improving the informal economy taxation method,it puts forward four suggestions as improving the taxation of small and micro enterprises,indirect taxationv,giving full play to the role of authority,and the provisional simple tax system.In addition,a modernized tax collection system needs to be established.Decentralizing tax administration authority to local governments and building a modern tax information system.And also build a modern tax information system,applying modern data such as big data.It not only improves the efficiency of tax collection and management,but also curbs the occurrence of corruption.Regarding improving tax compliance,firstly,establish tax compliance awareness,make informal economic activity subjects feel the sense of fairness in the tax system,the rules of government behavior,and the efficiency of government spending,Secondly,reduce the tax compliance costs,establish an informal economic service platform,and increase the targeted informal economy tax service to reduce the consulting costs.Finally,the punishment should be reasonably controlled.Other than punish the non-compliance of informal sector economic activity subjects,it also has a deterrent effect on the tax evasion of the informal economy,informative and transparent penalties reduce the contact between taxpayers and tax managers and reduce the incidence of corruption. |
PDF Full Text Request