The Research Of Tax Payable Capacity: The Theoretical Analysis And The Design Of Assessment Indicator System

Now days, Tax assessment is a common topic in the field of taxation. It has been mentioned frequently and believed as the effective means to boost the economic tax analysis and the tax base control, implement the scientific and refined tax administration and improve the quantity and efficiency of the tax collection and administration. From the authoritative opinion, the tax assessment is defined as through using the comparison and analysis methods on data or information, the tax authorities can make judgments to the truthfulness and correctness of the tax payers and their withholding agents' tax report from the aspects of nature and the quantity, and adopt further administrative measures. ~1But considering the main problems in tax collection and administration and the status quo or development direction of the tax assessment as well as other factors, the research object should not be settled or limited within the area of tax report's accuracy or validity. As an approach, tax assessment should be extended to the domain of economic tax sources which decides the tax payment and expose the inherence rules between the taxation and economy. Through using these common rules, we can detect whether the material tax payment behavior tally with them and prevent the tax erosion in time.Based on those considerations, this article takes the lead in putting the capacity of tax payable to the core of tax assessment. Firstly, the concept of tax payable capacity is defined as the tax base scale which is generated and created by the inputs and outputs of the production elements, also as the taxpayers' capacity to create and provide the taxation. In order to explain the significance of tax payable capacity research, this article narrates the relationships among the tax payable capacity, tax payables, the amount of tax report and the actual tax payments and divides the tax capacity into two forms, including the internal and external tax payable capacity. The further study also has been made to analyze the determinant factors of the internal and external tax payable capacity as well as its measurement conditions. The internal tax payable capacity demonstrates a kind of quality aspect which is determined by the taxpayers' economic activity. The external tax payable capacity is a kind of quantity aspect of income or wealth which is calculated by the economic and tax indicators, such as the production elements, etc. It is the manifestation and measurement reflection of the internal tax payable capacity. The measurement of the external tax payable capacity is the application of the economic production function theory in the taxation analysis and it is the core of the assessment of the tax payable capacity. The contents of the assessment of the tax payable capacity are as follows: after making sufficient review on the inputs and outputs of the production elements and accumulating abundant data, we can get the rules or references on inputs and outputs in separate line of business or products. Combining the concerned questions in tax collection and administration, we can make a framework of tax payable capacity assessment indicators, examine the taxpayers' external tax payable capacity through using the essential measurement indicators and control the tax bases. Also we can use the comparable assessment indicators in assessing the tax payment activity and make judgments on whether the tax payment activity is consistent with the external tax payable capacity. Through above mentioned theoretic analysis, the assessment of the tax payable capacity is much closer to the object substance than the assessment to tax report activity and it can give a better reflection on taxation scale and rules which is determined by the economic activities. The assessment of tax payable capacity can also prevent the misguidance of the tax incompliance and help the tax authority get the initiative during the course of the game with taxpayers.According to the theoretical narration of the tax payable capacity as well as its assessment principles and aimed at the disfigurement in the present tax assessment indicators' framework, this article gives an example of value-added tax and designs a tax payable capacity indicators system from the aspects of the essential measurement indicators and the comparable assessment indicators. The essential measurements indicators are used to measure and weigh the taxpayers' external tax payable capacity and these indicators are divided into production elements category and inventory turn over category. The comparable assessment indicators which are used to measure the relationship between the external tax payable capacity and the reported tax base are divided in the following categories: the tax and invoice frame of sales category, the income capital category, the tax and invoice frame of purchase category and the purchase capital categories. This article also makes a detailed explanation on such indicators' design principle, main components and their usage guides. The design of the indicators frame follows the principle of purpose, definitudes, comparability, system and information. It gives the prominence to the core requirements that the frame design should be surrounded by the purpose of the assessment and the characteristics of different taxes, the indicators should be aimed at the abnormality of the tax payable capacity, the data source and caliber should be definite, the economic or tax payment activity should be correctly reflected and the information technology should be implemented, etc.In order to confirm the effectiveness of tax payable assessment theory, this article takes a manufacture factory of Chinese date an example which is located in Dezhou, Shandong Province as an example. In early 2007, the author made a field survey on the factory's business and tax related information and implemented the tax payable capacity indicators system to the factory. The article made a detailed explanation on case study analysis, the choice of the assessment indicators, the analysis steps or methods and made the theory study in this paper have great significance in guiding the assessment practice.In summary, the total amount of a nation's tax revenue comes from individual taxpayer's tax payable. The tax payable capacity generates the base of the tax payable and it is determined by the inputs and outputs of the production elements. Under the present tax report regime, the professional indicators' system and the means of information technology must be exerted to analyze and estimate whether the taxpayer's business scale and tax payable are truly and evidently be reflected by the contents of tax report. With multi-aspect and multilevel analysis, the tax assessment regards the tax payable capacity as the core and it can accomplish the purpose of the entire control of tax base and the prevention of tax erosion.