Research On Tax Regime Of Digital Economy In China

With the deepening of economic globalization,information and communication technology has penetrated into various fields and industries of the society in multiple dimensions,and the social economy has gradually become a new economic form relying on digital technology and knowledge resources,that is,digital economy.In order to strengthen competitiveness,all countries in the world are constantly investing the construction of information infrastructure to maximize the close integration of the Internet and the real economy,and then promote the high-speed operation of their own economy.With the development of business models of the digital economy,various tax issues have emerged one after another,such as the profit distribution and taxing rights of the cross-border transactions,the income characterization,the collection and management of value-added tax of crossborder transactions and other related issues.How to deal with the tax challenges resulted from the digital economy in order to ensure the taxing rights and tax fairness,is not only an urgent problem to be solved by the OECD,the EU and other countries in the world,but also an important issue to be solved in the reform of China’s fiscal and tax system and in the process of realizing the modernization of national governance.The main research content of this paper is divided into six parts.Firstly,it introduces the research background and significance of the tax system of digital economy from the international level and the domestic level.The tax issues of the digital economy at the international level mainly focus on two aspects: First,whether and how should the tax rights of cross-border transactions be distributed among different countries,and whether the profit distribution and linkage rules of the current international tax system are applicable;Second,because digitization facilitates tax avoidance,it is easier for multinational corporations to transfer profits to low-tax or tax-free areas.In addition,it is urgent to solve the digital economy tax issues of the domestic level: from the perspective of the status quo of China’s digital economy and related tax issues,since the determination rules of the basic elements of the current tax system in China are all for the construction of the traditional economy,the applicability of several basic elements in the current tax system is challenged by the emergence of the new business model of digital economy.In addition,there are certain problems in tax collection and management as well as the fiscal and taxation systems.The second part is the research of digital economy tax theory.This paper is based on the related theories in the field of public finance,jurisprudence,industry economics,providing theoretical support for the research of the tax system of digital economy from the necessity and feasibility of the taxation of digital economy,specifically according to the theory of the public goods,value creation user contribution and the global value chain theory to demonstrate the necessity of the taxation of digital economy.In the meantime,this paper tries to analyze the feasibility of taxing digital economy from the point of view of taxability of subject and object.The third is an analysis of the development status of China’s digital economy and related tax systems.This part tells the development history and status quo of China’s digital economy,and introduces the development status of digital economy business model and profit methods in detail.In terms of income tax,it mainly analyzes the problems and challenges brought by digital economy to income tax from three aspects: The current permanent institution identification rule data and the ownership of value creation and the digital economy BEPS related to income tax;In terms of value added tax,this paper analyzes the problems and challenges brought by digital economy to value added tax from the perspective of exemption of import of low-value goods in digital economy and the current situation of cross-border supply of services and intangible assets by digital economy enterprises to consumers(B2C transactions).The fourth is the quantitative research on tax issues of China’s digital economy,mainly an empirical analysis on the relationship between digital economy and taxation.This part takes e-commerce,one of the major business models of digital economy,as the entry point,uses the time-fixed effect model to conduct multiple regression analysis on the impact of B2 C e-commerce transactions on corporate tax avoidance tendency,analyzing the impact of e-commerce on China’s corporate tax avoidance tendency.The study has found that under the control of a series of factors such as the growth rate of operating income,the number of subsidiaries,fixed assets,intangible assets,the age of the enterprise and so on,e-commerce enterprises have a strong tax avoidance tendency.That is to say,digital enterprises represented by e-commerce enterprises do evade certain tax burden to a large extent,which leads to the problem of invisible unfair tax burden.In the current process of economic globalization of digital economy,the tax problems caused by digital economy are becoming more and more serious.The research conclusions of this paper have certain policy enlightenment for the reform and improvement of the current tax system in China.The fifth is the international experience of tax system construction of digital economy.This part analyses the tax measures to address the digitalization of economy in the world.It starts from the research and exploration of OECD to deal with the tax issues of digital economy,and analyzes in detail the countermeasures of BEPS inclusive framework under the leadership of OECD to deal with the tax issues of digital economy,especially the twopillar program.Secondly,it analyzes the digital service tax promoted by the European Union and points out its advantages and disadvantages.In addition,it also classifies and summarizes the system design of major countries in the world to deal with the tax problems of digital economy,such as modifying the definition of permanent institution to construct the standard of virtual permanent institution and applying withholding income tax to digital transactions to guarantee the tax right of each tax jurisdiction and the implementation of a simplified VAT collection mechanism,VAT segmentation payment mechanism,VAT realtime invoice declaration system and other measures to prevent the loss of VAT revenue.Finally,based on the effects that the OECD two-pillar program might have on China,this paper suggests we should build tax regime of digital economy with Chinese characteristics.In order to improve the income tax system,China should revise the definition of permanent institutions and construct the standard of virtual permanent institutions,revise the income source determination rules and profit distribution rules in China’s tax law,bring data transactions into the scope of income tax and levy withholding income tax on digital transactions.From the perspective of perfecting the VAT system,China should perfect the VAT policy of imported low-value goods,and construct the VAT segmentation payment mechanism.Besides,the VAT real-time invoice declaration system will be implemented,digital services will be gradually included in the scope of VAT collection in China,and VAT tax places for cross-border B2 C digital products and services and intangible assets will be determined according to the principle of place of consumption.China should also further revise the law of tax collection and administration to strengthen the digital economy tax management from the perspective of tax collection and administration.At the international level,we should strengthen cooperation in international tax collection and management,actively participate in the global tax governance system,put forward our own demands in the reconstruction of the current international tax order,master a certain right of discourse in the process of deeply participating in the formulation of international tax rules,and protect our tax rights and interests to the greatest extent.