The Financial Impact Of A Construction Company On “BT To VAT” And Suggestion

This was the first time for China to implement the work of experimental unit of “the VAT replacing the business tax”(referred to as “BT to VAT”)began in shanghai from the industries of transportation and part of the modern service industry on January 1,2012 and obtained ideal effect,and then in various provinces and cities of the vast majority of the industry began to implement “BT to VAT”,but because of some reasons,“BT to VAT” has not been pushed on the construction industry.According to the ministry of finance,state administration of taxation announced the change implemented on “BT to VAT” pilot notice(caishui [2016] 36)on March 23,2016,and on April 19,2016,the state administration of taxation issued the change implemented on “BT to VAT” pilot announcement concerning the tax administrative matters(the tax [2016] 23),specifically speaking that on May 1,2016 all industries will be to implement “BT to VAT”,namely,on May 1,the construction industry will enter the scope of “BT to VAT”,since then the business tax will gone forever.The construction has always been the important material production department of the national economy,moreover it is related to the development of national economy and the improvement of people's life.In order to avoid the problem of double taxation,further promote the development of the social division of labor and specialization,it is necessary for construction industry to implement “BT to VAT”.And meanwhile it is a big tax reform,that has a significant impact on enterprise's financial management,operation,invoice management and other aspects.For construction enterprises can better transform the management mode of operation in the process of “BT to VAT”,as soon as possible to adapt to the tax reform,reduce risk and loss,this paper will take a big enterprise for an example to analyze the reasons why this company would have these difficulties and the different with the ideal impact at the start of “BT to VAT”,and there are some suggestions for A in the end of this essay.Through these data analysis,it is concluded that there is a problem for A that new projects' tax is higher than before,and it is mainly caused by the purchase of commercial concrete materials,the payment of construction labor and the long-period characteristic of projects themselves,etc.,and therefore resulting in a decline in the business profit of the current period.In the second half of this article,it puts forward some suggestions on the issues of capital flow,cargo flow,contract flow,invoice flow and enterprise internal control.