Research On Transnational Operation Tax Planning Of Chinese Group Company

The21st century is the era of economic globalization and trade liberalization. With theadvantages of its own unique organizational structure and diversification of business, thegroup companies continue to carry out overseas investments and have become the main forceof China's transnational operation. The increase of the transnational operations has broughtthe benefits. It has also simultaneously brought the risk of double taxation and theopportunities to seek mitigation of tax burden. The group companies must developtransnational operation tax planning strategies to combine the transnational operationsactivities with transnational tax planning. Systematic in-depth study on the transnationaloperations of group companies helps of extensive experience in financial management offoreign tax and deepens the depth of the discussion of theory about financial management ofinternational taxation factors. At the same time, the research provides a reference to carry outtransnational tax planning activities for group companies.The paper makes the group companies as the research subject and uses the researchmethods of the comparative analysis, the qualitative analysis combined with quantitativeanalysis and the theoretical analysis with a case analysis. It analyzes the group companies' taxplanning according to the line of transnational financial activities. Transnational tax planningstrategies are validated through cases. This paper analyzes the basic theories of the taxplanning and transnational tax planning, the concept and basic features of group companies.On the basis of the basic theories and basic features, the paper analyzes the necessity andfeasibility of transnational operation tax planning of group companies. It analyzes the statusand trends of transnational operation in group companies. At the same time, it introduces theinternational tax environment. Using the SWOT analysis analyzes and summarizes theexternal and internal factors of transnational operation tax planning in the group companies.When group companies formulate transnational tax planning strategies, they must keep tomake full use of the advantage of their strengths and opportunities. They must keep to weakenthe weaknesses and threats to select the optimal transnational tax planning. According to theline of transnational financial activities, the paper analyzes the transnational tax planning strategies. In the transnational financing activities, the group companies can choose the taxplanning strategies, including to internationally thin capitalization, to establish theinternational finance corporation and to carry out international financial leasing. In thetransnational investment activities, the group companies can make planning through thechoices of investment locations and organizational forms. In transnational day-to-dayoperations, the group companies can develop the tax planning strategies according to theinternational procurement, international sales, non-commodity activities and human resourcemanagement activities. In transnational income distribution activities, the group companiescan choose to lower the dividend payout ratio, to pay goods instead of dividend, to make useof deferred tax provisions and to carry out treaty shopping. And the paper takes the exampleof the company "ZY" to verify the basic strategies of transnational tax planning.