Resource Enterprise Group Tax Planning Research

In recent years along with the development of China’s taxation administrationsystem, the level of corporate tax administration has been improving year by year andmore and more attention has been attached to the tax planning with each passing year.Meanwhile, in the process of business expansion, the continuous emergence of largeenterprise groups and their expanding scales have made it more difficult in tax riskmanagement. In the tax planning process, in addition to tax benefits, the tax riskcircumvention is also an important element in the tax administration of an enterprisegroup. In spite of progress China has made in its tax planning, but due to therequirement of a combination of tax planning and specific tax policies and morefrequent adjustments to its tax laws and policies in recent years, a great number oftheoretical results have become no longer applicable. What’s worse, the complexity ofproduction and operation processes as well as the involvement of numerous taxes andtax policies has resulted in more difficulty in tax planning of resource-basedenterprise groups.Combined with the existing tax planning theory and our current tax laws andregulations, this paper is intended to do a research on tax planning and tax riskmanagement of the resource-based enterprise groups on the basis of the characteristicsof resource-based enterprise groups in order to develop specific tax planningstrategies involving higher correlation with the resource-based enterprises, which arecorporate income tax, personal income tax, value added tax and resource tax, andother taxes by analyzing various aspects of the business activities. The study alsoincludes analysis of causes, identification and circumvention of tax risk. This studystrives to identify the key point of tax administration of resource-based enterprisesgroups and the main point needed for improvement through case studies of YunnanTin Group (Holdings) Limited. This paper concludes that the tax risk management should be the key point of thetax administration of resource-based enterprises groups. The tax risk quantitativeindex system should be used in the prevention of tax risk. To maximize the incomeafter taxes, resource-based enterprises groups should place all industrial processes inthe same taxable entity and increase their investment in R&D.Hopefully, this study can help resource-based enterprise groups to improve theirown tax administration, reduce tax risk and maximize economic interests.