Study On Tax Risk Management After Tax Reform

Since May 1,2016,the reform to "replace business tax with value-added tax(VAT)"("the VAT reform")has been implemented across the country,and the value-added tax has achieved comprehensive coverage across goods and services industries.As a significant reform in the China's taxation history,the VAT reform,which marks the end of business tax,is one of many important measures of supply side structural reform,implementation of structural tax cut,and the promotion of industrial restructuring.The switch from business tax to value-added tax not only can effectively reduce corporate tax burden,but can also greatly reduce corporate cost and financial risk,avoiding double taxation and a series of problems.So far,the VAT reform has had a huge impact on China's economic and social development.At the same time,such issues as the transition from the old tax system to the new one,the demand for tax control,and changes of business processes have arisen constantly,combined with worsened existing problems such as the imbalance of tax administration workforce structure,have created a series of internal and external factors which are causing intensified risk in law enforcement,tax collection and management,and integrity of tax authorities,and other kinds of taxation risk.Consequently,tax collection,management and tax service are faced with many difficulties and challenges.Tax compliance and efficient operation of institutions are the objectives of tax risk prevention.Changes in external and internal conditions have made the uncertainty of tax risks more prominent,and tax risks arising from different causes and circumstances,with different impacts are generated or hidden in various procedures of taxation practice.Tax authorities,amid these realities,should take realistic,appropriate and forceful measures to strengthen risk management,so that they can play a proper role in the pig picture of reform and development.and ensure steady implementation of VAT reform.This article studies the current taxation practice after the VAT reform,characteristics and causes of all kinds of risks,and by applying theories of modernization of governance capacity and modern risk management,drawing on experience of foreign countries in effective response to risk,has proposed targeted measures and methods of tax risk prevention,providing some useful ideas and directions in taxation practice.