Research On Tax Coordination Between China And Russia

Russia is an important economic partner of China,and their economic cooperation is increasingly close.China has been Russia's first trading partner for eight years,with bilateral trade volume reaching 108.2 billion US dollars in 2018.In recent years,the two countries have made important progress in infrastructure,energy and agriculture,and their cooperation prospects are promising,China needs to pay more attention to its economic cooperation with Russia.Under the current situation,in order to further deepen the economic and trade cooperation between China and Russia,we need to face up to the differences in interests and systems between the two countries.Conflicts of interest arising from these differences will become increasingly prominent,resulting in tax barriers,repeated taxation and tax evasion across borders.It will affect the free flow of goods and capital between the two countries,thus eroding the tax base of the two countries and harming national interests.Tax coordination can solve the problems of double taxation and international tax evasion by improving the tax coordination mechanism between China and Russia,eliminating tax barriers between the two countries.Therefore,in order to prevent tax from impeding the economic and trade development of China and Russia,the most effective way is to coordinate tax revenue.Firstly,this paper introduces the meaning of tax coordination and related theories.Secondly,combining with the current situation of trade and investment between China and Russia,this paper analyses the impact of Taxation on Sino-Russian economic cooperation,and illustrates the importance of tax coordination between China and Russia.Subsequently,it makes a concrete analysis of the current situation of tariff coordination,income tax coordination and tax management coordination between China and Russia.Starting from the current situation of tax coordination,this paper analyses the problems existing in tax coordination between China and Russia.First,the level of tariff coordination is low.In terms of tariffs,Russia's import tariff rate is too high,there are tariff peaks and unreasonable tariff quota system.Grey customs clearance incidents occur frequently between the two countries,and the Sino-Russian free trade zone has not yet been established.Second,bilateral tax agreements are imperfect.The new tax agreement between China and Russia signed in 2014 still has some shortcomings.There are loopholes in terms of permanent establishment clause,dividend income clause,tax concession clause and information exchange clause,andthe propaganda of the tax agreement is not in place.Fifthly,there is no sound mechanism for resolving tax disputes between China and Russia.Then,through the analysis of the cases of "Company A sues Russian tax authorities" and "Russian inspection of Chinese goods",the paper further illustrates the problems existing in the tax coordination between China and Russia.Finally,according to the problems existing in the tax coordination between China and Russia,starting with the tax coordination,and on the basis of drawing lessons from foreign tax coordination experience,the paper puts forward some suggestions to improve the tax coordination mechanism between China and Russia.Firstly,deepen tariff coordination.By reducing tariff rate and abolishing unreasonable tariff quota system,we can eliminate tax barriers,clear up the phenomenon of "gray customs clearance" and speed up the establishment of Sino-Russian free trade zone.The second is to improve the tax agreement between China and Russia.The coordination of income tax mainly focuses on improving bilateral tax agreements and avoiding double taxation.It is necessary to extend the time limit for the identification of permanent service-oriented institutions,increase the identification of virtual permanent institutions,clarify the applicable conditions of dividend income tax clauses,increase tax concession clauses,strengthen the exchange of tax information between the two countries and increase the publicity of tax agreements.Thirdly,we should set up special tax coordination departments and improve the tax coordination mechanism.The fourth is we should establish a reasonable compensation mechanism for interests.In order to ensure the smooth development of tax coordination,China and Russia need to proceed from the overall interests,transfer tax sovereignty to a certain extent,and make reasonable compensation for the damaged party in the process of tax coordination through the tax benefit compensation mechanism.The fifth is we should improve the mechanism for resolving tax disputes between China and Russia.The two countries need to improve the mechanism of mutual consultation and join the arbitration method in order to broaden the channels for resolving tax disputes.