The Study On The FDI Situations Influenced By Vietnam Tax Policy

After introduced reform and opening-up, Vietnam, with continues expanding and developing FDI in recent years, whose GDP growth has remained at the forefront of the world, is recognized as one of the most developing potential nations. Tax policy plays as an important role in FDI, the Vietnamese Government attached great importance to the use of tax policy. Vietnam is neighboring to China, and both two developing countries have amount of similarities in economic development. By the establishment of China-ASEAN Free Trade Area, the author made analysis on the relevant tax policy of Vietnam, and analyzed the effectiveness of FDI, and finally provided some opinions as references for China.First of all, according to the taxation and FDI basis theory, the article summarized the underlying factors of FDI and depicted the status of tax factor in FDI investments. Then, the author explained the present tax system, tax incentives with regard to FDI in Vietnamese, as well studying the current data of FDI and relative tax to explain their practical influence. In additionally, using statistics (since 2000 to 2013), where Vietnam FDI tax rates be set as a main statistical indicator, the author analyzed the mechanism of FDI affected by tax policy in Vietnam constructing an econometrical VAR model and applying impulse response analysis and variance decomposition analysis. Being affected by two economic crises and several domestic policies’ change, the result indicated that tax policy cannot significantly impact FDI. Finally, the authors advised several experience references from Vietnam and gave conclusion and prospection understanding the theoretical analysis, reality situation, and measurement statistics.