Research On Our Country'S Legal System Of Tax Allowance Of Small And Medium-sized Enterprises

Since the 1980s, the development of SMEs(small and medium-sized enterprises) has been concerned by various countries. SMEs in China have made tremendous contributions to China's economic development and social progress. According to the data, by the end of 2006, the number of SMEs in China has reached 42 million, among which more than 4.6 million SMEs are registered by the business administration and 38 million of them are self-employed households. The value generated by the SMEs'products and services has accounted for 60% of the gross domestic product and the SMEs have paid 53% of the country's total tax revenue, completed 65% of invention patents, developed 80% of the new products of the country and provided 80% of the urban employment positions. Due to their enormous scale and prominent position our country has also attached great importance to the development of SMEs by establishing a series of policies to encourage and support the development of SMEs. Tax policy is one of those important measures and especially the preferential income tax policy for SMEs, as the main form of tax measures, is effectively significant in reducing the burden on SMEs, encouraging SMEs to technological innovation, and adjusting industrial structure. With the support of some relevant policies, development of the SMEs is in good condition, but still they have some issues, such as low-tech, financial ability, lack of innovation, irrational industrial structure and so on. Chinese scholars'researchs on the system of tax incentives for SMEs mainly focus on level of management and they haven't made progress in the level of law. This article, based on the specific background of the SMEs'development in China, aims to enhance the competitiveness of SMEs in the market by exploring legal support for SMEs'development from the tax concessions and improve the system of preferential income tax policy for SMEs .Article start from the analysis of SMEs, the tax system, tax preferential legal system and the relationship between them, describe the theoretical basis and the significance of our country ,SMEs tax preferential legal system, and based on the current status of SME development of our country, analysis of the development of SMEs in China's legislation on the provisions of the relevant tax. I get some inspirations on comparing the SMEs tax preferential legal system of other countries and regions, especially developed countries, we should solve the problem in view of the practical issues for SME development of our country. The article stressed from the legislation and should be legislation for SMEs Tax Law, and suggestions to further improve the tax incentives for SME development was the supporting system of laws and regulations be revised in the past do not meet the legal reality.