Study On The Boundary Problem Of VAT Expanding At The Present Stage

This paper first introduces the related theory of value-added tax, value-added tax is aneutral and efficiency tax, these two characteristics constitute the theoretical foundationof VAT expanding, on this basis, this paper analyzes the process of VAT’s developmentin China and the present problems facing in China, the most important problem ofVAT in china now is that it’s scope is too narrow,methods to solve the problem is toexpand the scope of VAT, but as mentioned above,the expansion is a double-edgedsword,it will not only bring benefits to the enterprise and the state,but also bring about aseries of problems, combined with the reality of our country at the present stage,thispaper introduces the positive and the negative effects of VAT expanding.after this, thispaper suggests six principles for VAT expanding to follow. This six principles asfollows:First, the reform should be looking forward and be adapt to economic trends.Second, the double taxation of the industry is serious or not.Third, the best situation of revenue and optimization cost.Fourth, whether the correlation with the production and consume is close.Fifth, whether the taxpayer can stand it.Sixth, whether it is feasible in technical and operational.In these six principles, based on the fourth principle of this paper this paper leads tothe preliminary conclusion that at the present stage industries suitable for including inthe scope of VAT is: construction,railway transport,postal services, insuranceentertainment,this is only preliminary conclusion.based on the other principles andfurther analysis, this paper argues that the industry boundaries of VAT expandingincluds: railway transport, postal services, banking (part of it), insurance.After the industry boundary is found, this paper study on the area boundary at thepresent stage, after serious analysis,this paper believe that Experiment in shanghai andthen move forword in several pronvinces is not suitable,this paper suggests that thereform should follow the mode of Experiment in shanghai and then move forword inwhole china.