Research On The Problem Of China’s Luxury Tax

In recent years, with the development of economy, China’s luxury market also grows up rapidly. In2009, our luxury consumption amount to77billion RMB. In2010, our luxury consumption amount to212billion RMB, including mainland personal luxury expenditure for87.1billion RMB, with increase27%compared with2009, and ranked fifth in the world. If add Hong Kong and Macao market, the luxury consumer spending of the greater China region has entered into the top three. In2011, China’s domestic luxury consumption amount has reached1392billion RMB, become the world’s second largest luxury consumption market, second only to Japan. China’s luxury sales growth rate has maintained the first for three years. At present, our luxury consumption market share has reached15%in the world. The whole world amazed by China’s consumer purchasing power of luxury goods. While, at the same time, there are30million farmers have problems in food and clothing, hundreds of millions of urban housing problem need to be solved urgently. On the one hand, luxury consumption market height prosperity; on the other hand, income gap become bigger and bigger, social stratum differentiate quicker and quicker. This needs to be worry about so much.In such cases, if only rely on the power of the market mechanism to adjust income distribution gap, and solve the social class differentiation problem is not very realistic. Therefore the government has to step in, with the help of economic, legal and administrative means to adjust the market distribution. Tax, as an important tool in the government’s macro-control, must play a role in regulating consumer behavior and economic development. Therefore, this paper begins with the definition of luxury, bases on the analysis of China’s characteristics of the luxury consumption market, and then points out that in our country, tax on luxury goods is very necessary and meaningful. After that, the author discussed our current situation of luxury tax, and then analyzes the different reaction in different consumers and their different consumption psychology when luxury tax cause luxury goods price rise. At last, the author also puts forward some problems in our luxury tax, and advances some corresponding solving methods aiming at the problem. This paper is helpful to perfect our tax system, regulate the income distribution, and promote economic development and social harmony. It has some important and realistic meanings.This paper is divided into four parts:The first part is introduction. In this part, the author first explains the research background and significance, then introduces the related research results, and finally points out the framework, innovations and shortage of this paper.In the second part, the author gives the definition of luxury goods, and introduces the current situation of China’s luxury consumption market, and points out our unique features, including:the high growth rate, the immature in our luxury market, consumption depends on foreign brand and consumption spillover seriously, etc.In the third part, the author first discussed our current luxury tax position, then analyzed the impact on the economy of luxury consumption, including positive influence and negative influence, as well as the necessity of tax on luxury goods. After that, the author discussed the different tax effect on different customers and their different consumption psychology. At last, the author expounds the problems in the current consumption tax on luxury expenditure.In the forth part, in view of the above questions, the author puts forward his own suggestion in how to improve the luxury tax.In this paper, the main research method is:combined with theoretical analysis and empirical analysis together. Through theoretical analysis, the author points out the current situation and characteristics of China’s luxury consumption market, and points out that in China tax on luxury expenditure is meaningful. Then through empirical analysis, the author points out our current tax situation on luxury, as well as the tax effect on it. At last, based on the analysis above, the author puts forward his own suggestions to perfect the luxury tax system in our country, aiming at the existing problems, which gives some reference significance in perfecting our luxury tax system.