Tax Avoidance Of Multinational Companies And Tax Anti-avoidance Of China

With the rapid development of the economic globalization, the multi-national enterprises (MNEs) have become the dominant power of the world economy. In order to maximize their profits, the MNEs globally allocate their resources. As there are various differences among countries on tax rate, legislation and administration, the MNEs can conveniently make their global tax plan. In addition, the rapid development of economic and lagged improvement of legislation have promoted the situation of international tax avoidance (ITA) which does harm not only to tax escaping but also tax dominion and principle of tax fairness.After its entrance of WTO in 2001, china is in great harmony with the whole world. By the end of 2002, China has become the country that attracts most foreign direct investments in the world. MNEs play more and more important roles in china's development of economic. Accordingly, the problem of ITA has become the biggest concern of Chinese tax authority. MNEs avoided tax nearly 30 billion every year. They escape tax by the pseudophase of book loss. ITA is decreasing Chinese financial revenue;weakening competition power of domestically funded enterprises;disturbing the economic order and making negative effect to the moving of international funds.Proceeding from objective realities and using other's research for reference, this article analyses Chinese ITA by case studying. It tells the situation, harm of ITA and the common methods taken by MNEs. By deep analysis of successful ITA experience of developed countries, it offers suggestion and reference to that of china. This article includes four chapters. In chapter one, it analyses the actuality, reasons and harm of ITA. In Chapter two, it introduces common used methods of ITA. In chapter three, it studies the successful experience of developed countries for ITA from the aspects of lawmaking and law executing. In chapter four, from the aspects of legislation and tax collection management it offers suggestion and countermeasures to ITA of china.