The Influence On The Tax Burden Of The Chinese Banking Operating Performance

Tax system is an important means of the government to regulate the economy. The banking industry, as the core of the financial system, its operating conditions has a pivotal role for the country’s economic progress and the development of other relating industries. Although the banking industry has undergone a lot of tax policy reform, but in society as well as the rapid development of the globalization process, the shortcomings of the current tax system have also gradually exposed. Whether it is for state-owned commercial banks, joint-stock banks and urban commercial banks, the tax burden is too heavy to have impact on the improvement of its operating performance and undermines the core competitiveness. Therefore, the research of tax burden for China’s banking industry as well as the analysis of the impact on its operating performance is imminent.This paper is divided into six parts. Firstly, describe the background and purpose, the content and methods of research, writing frames and innovation and summarize the research status of home and abroad. Secondly, analyze the overall tax policy, including the development of banking tax, the relationship of business profile and performance and the international comparison of tax burdens. Thirdly, in the theoretical point of view, use descriptive statistical methods and economic models to analyze the impact pathways of tax burden on the banking operating performance, including profitability, operational capability, development capacity and the ability to take risks. Forthly, by setting up panel data model for the empirical analysis of the16listed commercial banks from2001to2011, explore the actual tax burden level and the influence on operating performance, and compare the data of state-owned commercial banks, joint-stock commercial banks and city commercial banks to obtain the actual tax burden influence of different types of banks. Finally, based on the research conclusions provide some suggestions for Chinese banking tax reform and optimization.The main conclusions of the paper are as follows. Firstly, the tax burden of China’s banking industry is heavy. In terms of business tax, the tax base is broad and the tax rate is high. In terms of corporate income tax, the restriction of tax deductible policy is too stringent and there is double taxation. Secondly, tax burden constraints its operating performance through earnings, operations, development and risk, which demonstrated by reducing the profit of depositing and lending, improving the investment and financing cost of capital, improving the non-performing loans rate, and reducing the capital adequacy ratio. Thirdly, the empirical study results show that the banking industry’s actual tax burden and its operating performance have significantly negative correlation, and the less actual tax burden will significantly enhance the operating performance. Besides, the tax burden influence on the joint-stock banks’ operating performance is the most significant. Finally, there are two aspects to optimize the banking tax policy. As to business tax, adjust the tax bases and tax rates in short term and gradually incorporate the business tax into the scope of the VAT tax in long term. As to the corporate income tax, reform the tax-deductible policy.