The Study On Taxation System Of Life Insurance In China

Life insurance is a contract between the policy owner and the insurer, where the insured events are designated as the occurrence of the insured individual's or individual's death, and the designated benefices are to insure the life of the insured. In the modern economy, life insurance should be an effective means to manage a variety of personal risks, including the individual's health, aging, sickness, death and other risks. In China, life insurance is an important component of the constriction of the multi-level social security system.For current Chinese taxation system, the taxation system of life insurance is a difficult part yet. Not as with most other industries, life insurance has distinctive features, such as public welfare, economic compensatory, the uncertainty of operating costs and profit accounting, and the particularity and risks of the business activities. Since the reform of the Chinese taxation system carried out in 1994, the national economy has been maintaining a positive momentum of growth. Life insurance industry has also been developed rapidly and made good progress; meanwhile, its disadvantages have been apparent increasingly. The international financial crisis began in 2008, made the development of life insurance industry in temporary difficulties. Therefore, on the basis of the phenomenon in such a special period, the purpose of this study is to find the proper way how to improve China's taxation system of life insurance, and how to have the taxation system play the important role on the life insurance industry and of the national economy.This study was designed to explore China's taxation system of life insurance from two parts: the effect of tax incentives of life insurance demand and the practices of taxation system of life insurance. The qualitative research methods are primarily used in the analysis, including the use of the theory of supply and demand, and the elastic analysis method. Throughout the whole research, it was focused to balance the combination of static analysis, comparative static analysis and dynamic analysis, and the combination of historical analysis and comparative analysis, and the combination of theoretical research and practices. The structure of the thesis was arranged into five chapters: Chapter one is to introduce the meanings and purpose of this paper, literature review, structure of the content and innovation of the study. Chapter two is economical analysis on the impact of tax on life insurance, including the impact of taxation on the supply of life insurance, on demand of life insurance and taxes on the market equilibrium of life insurance. Chapter three is to study the current features of China's taxation system of life insurance, to review its history and development of evolution, and to the problems existed in China's life insurance tax system was pointed out as well. Chapter four is to compare the taxation system of life insurance in developed countries and regions. A number of representative countries and regions were chosen to be comparative analysis systematically and comprehensively, in accordance with the tax system analysis of insurance companies and personal tax systems. Chapter five is mainly about the improvement of China's tax system of life insurance. In this chapter, the standards and goal orientation of the tax system reform of life insurance were put forward, and the proposed suggestion on the improvement of China's taxation system of life insurance in the end.