Study On VAT Tax Planning Of Hejian Group After Changing Business Tax Into VAT

Since the full implementation of the "replacement of business tax with value-added tax" on May 1,2016,the construction industry in China has changed from 3% of business tax rate to 11% VAT rate.And this important measure of structural tax reduction has a great impact on the tax burden and profit of the construction industry.On April 4,2018,State Administration of Taxation issued a notice on the adjustment of the VAT rate,which stipulates that if the taxpayer has the taxable sales act of VAT or imports goods,the original 11% tax rate shall be adjusted to 10%,which shall be implemented from May 1,2018.As one of the pillar industries of our national economy,the construction industry has long been difficult to deduct the amount of taxes on purchases due to its special industry nature,so it still belongs to the small-profit industry.The continuous deepening of the reform policy of VAT will lead to the change of tax amount and tax treatment,resulting in changes in project budget and final accounts,management model,organization structure,financial management and other aspects.And it is even likely to affect the future development target and management model of the enterprise.Therefore,it is necessary to study the VAT payment planning of building enterprises after "replacement of business tax with value-added tax".The national law encourages taxpayers to make legal tax planning,and the vigorous development of tax planning is also conducive to the continuous perfection of the tax system.This paper takes Shandong Hejian Corporation Group Ltd.(hereinafter referred to as “Hejian Group”)for case study.Based on the characteristics of the enterprise’s management and development,it first elaborates the research background and significance,and puts forward the research ideas and methods.On the basis of the impact of the policy of "replacement of business tax with value-added tax" on the tax burden of Hejian Group,the current situation of VAT payment in Hejian Group is analyzed and the corresponding measures are put forward for various problems.The VAT planning scheme designed in this paper includes the following five aspects.First,it is to choose reasonable VAT mode,and calculate the general tax mode and simple tax mode in concrete construction projects.Second,it is to screen material suppliers.Third,it is to make reasonable plans for different ways of labor service.Fourth,it is to choose the mechanical lease scheme with the lowest tax burden.Fifth,it is to compare and choose tax calculation methods for new and old projects.It is hoped to these schemes can assist Hejian Group in smoothly passing the period of policy reform.In the face of the opportunities and challenges brought by the constant VAT reform,in order to adapt to the development of the times and to take the first place,Hejian Group must carefully analyze the new policy and formulate practical and effective VAT planning scheme from the perspective of the whole enterprise,so that it can offset or reduce the negative effects brought by "replacement of business tax with value-added tax",and help Hejian Group adapt to the policy of "replacement of business tax with value-added tax" and the following VAT adjustment as soon as possible,thereby maintaining the steady growth of economic benefits.Moreover,through the effective management and control of the risk in the planning process,it is necessary to not only achieve the purpose of reasonable tax reduction,but also to do the best to avoid the risk in the process of tax payment.It’s hoped that this paper can have a positive impact on the tax planning of the construction industry after the VAT reform.