On The Effects Of Replacing The Business Tax With Value-added Tax On Construction Group Enterprises

With the repaid development of Chinese economy,value-added tax and business tax simultaneously existing has been unable to meet the needs of enterprises and even the industry.Since 2012,China has been pushing the policy of changing Business Tax to Value-Added Tax(VAT).The industries that originally paid the business tax are included into the scope of value-added tax.Up till May,2016,this change has been fully completed nationwide.As a pillar industry of China's national economy,construction industry has been transformed from Business Tax payers to VAT payers,from taking the whole business profit into tax calculation to taking only the increased profit.In addition,the construction industry's applicable tax rate has been increased from 3% to 11%.As an important force to promote economic and social development,the construction industry is the material basis for the survival and development of various sectors of the national economy.Buildings,such as factories,warehouses and structures,such as roads,docks,dams are construction industry products needed by other production sector of the national economy.Industrial machines and equipment must also be installed through the construction enterprises to form the final production capacity.For construction companies,the change from business tax to value-added tax not only affected theirrevenue confirmation,overall tax burden and financial status,but also led to the changes of their bidding work,overseas operation and core competitiveness.This put forward new requirements towards improvement of tax management and tax planning methods.This paper analyzed the implementation of such change and the development status of the construction industry.The analysis showed that the change of the applicable tax system had a great influence on the construction group enterprises,which also had a certain impact on our economy.This article went with the combination of theoretical research and empirical research.First,it expatiated on the status of construction group enterprises and the current situation of tax collection and administration,and drew the tax changes of the construction group enterprises before and after the change from business tax to value-added tax.Secondly,based on the SWOT model,this paper focused on analyzing the influencing factors of the taxation of the construction group enterprises after this tax change.The author of this paper used mathematics and econometrics for statistical analysis,used empirical analysis to examine the changes in financial data and operational management of construction group enterprises,with follow-up observation in their organizational structure,financial management,etc,analyzed whether they had optimized anything to adapt this tax change.Finally,the paper analyzed the internal problems of the enterprise groups and the irrationality of the current tax system,and put forward the corresponding optimization and reform proposals.