Research On Tax Administration Costs Of China

Ever since the reform of the tax distribution system in 1994, with the development of China's economy, the tax revenue has been increasing constantly, especially in these years it has sharply risen. However, the costs of tax administration in China are also remarkably rising with the increasing tax revenue, and they have surpassed the appropriate range and influenced the quality of tax management and the efficiency of tax collection. Early in 2004, some Chinese scholars suggested that the cost rate of the taxmen in the budget was over 5%. And in 2009, according to the reports in Economic Information Daily, the taxmen cost rate of China in recent years is approaching 8%, while on the other side that of developed countries is maintained around 1%. Relevant scholars estimate that if the taxmen cost rate of our country dropped by 4%, 120 billion yuan would be saved every year and the taxation department would fulfill their annual tasks.The theories about tax administration costs in the early years mainly stemmed from the discussions on taxation principles in classic occidental economics, based on which modern western scholars extended research directions, emphasized the research on the measurement of tax administration costs and evaluation and analyze the efficiency of tax collection and management. Scholars of our country have combined these western theories and the reality of China and have paid more and more attention to the theory and practice of tax administration costs and a great number of opinions and proposals have been raised, which has ascended the research and reflection on this problem and is conducive to optimizing tax administration costs of relevant departments and enhancing tax collection and management efficiency. However, the problem of high tax administration costs in China hasn't seemed to be alleviated, in which scenario this paper is done. The components of tax administration costs, factors influencing the tax administration costs of China, how to optimize tax administration costs of our country and main parameters to measure tax administration costs are analyzed and studied in this paper. The meanings of this paper are mainly represented by: firstly, the problem of tax administration costs has been studied systematically, which is conducive to enriching the tax management system of China; secondly, it is a necessary requirement of the development of market economy; thirdly, it will help improve the comprehensive quality of tax staff; fourthly, it will enhance the tax consciousness of tax payers.This paper can be divided into five parts. The first part is the introduction which mainly demonstrates the background, purpose, meaning, literature review, structure, innovations and deficiencies of this paper. The second part is the definition and components of tax administration costs which mainly includes basic ideas, specific explanations, instructions and further analyses. The third part is the analysis on the factor influencing the tax administration costs of China which is carried out from the aspects of tax resource situation, tax organization structuring, taxation system, tax levying and paying environment and the cost consciousness of taxmen. The fourth part is the approaches to optimize tax administration costs of our country and policy suggestions have been made on the operation of tax collection and management in combination with tax resources, the optimization of tax organization structuring and tax system, the improving of the tax levying and paying environment and the enhancement of the cost management consciousness of taxmen. The fifth part is the measurement of tax administration costs which has mainly discussed the meanings and basic parameter system of tax administration costs.The conclusions of this paper are as follows:first, the tax administration costs of China are high; second, tax administration costs are composed of three parts of costs of taxmen, costs of tax payers and socioeconomic costs; third, factors that influence the tax administration costs in China mainly include tax resource situations, tax organization structuring, tax system, tax levying and paying environment and the cost consciousness of taxmen; fourth, the main approaches to optimize tax administration costs of China are the operation of tax collection and management in combination with tax resources, the optimization of tax organization structuring and tax system, the improving of the tax levying and paying environment and the enhancement of the cost management consciousness of taxmen.The research in this paper is mainly done through literature study, empirical analysis, combination of theories and practices and system analysis.Some innovations are also presented: Firstly, the constitution of tax administration costs has been demonstrated. Secondly, relevant factors influencing the tax administration costs of our country have been studied systematically. Thirdly, approaches to optimize the tax administration costs have been proposed. Fourthly, the index system to measure tax administration costs has been summarized and designed.The shortcomings of this paper were mainly reflected in the following aspects: First, practical experiences are insufficient. Second, the references are limited. And third, the data collection is difficult.