Advanced Research On The Effect Of Tax Cut On The Background Of Deepening VAT Reform

“Tax cuts and fee reduction” has been widely discussed over recent years.Essentially,it is about feasible action that aims to bring down enterprise taxation by implementing a set of taxation policies in a realistic consideration.Its main goal is to support the enterprise’s development and consequently sustain long-term stable growth for our economics.As the national VAT system reform being deepened,the positive effect of “tax cuts” from the new policy of VAT has become increasingly prominent.Currently,researches of the mainstream are focusing on topics of a macro level.However,concrete examples and associated supportive data analysis,which would show how deepening VAT reform affect different industries,are still lacking.In this vein,this thesis will study the effect of the tax cut in an approach of the VAT reform.In the first part,based on a thorough review of domestic and foreign research results of the VAT system,tax rate,tax reduction,a concrete analysis in the framework of relevant tax reduction theory of Keynesian School and Supply School is carried.As a result,a theoretical framework is constructed that will be used for our later analysis in this thesis.Secondly,the VAT system in China will be introduced with a focus of details on each individual basic concept that will be mentioned in our thesis.The history of VAT in China is presented in view of tax rate variation.Later,a case study for Z new district is presented.The tax burden of the industry is calculated by currently available information and an elastic coefficient of “Sales Revenue-Taxable Amount” is constructed.These two parameters are then fed to our model that would eventually perform an overall analysis of the practical effect of VAT policy change on general taxpayers from the core industries(namely the real estate,wholesale and retail,finance)and typical industries in Z new district.The last part will present the conclusion and main results of this thesis.Based on summarizing the fundamental elements that linked to the effect of tax cuts action,the shortages and insufficiencies in the aspects of both policy-making and implementation are elaborated.More importantly,several specific suggestions for future VAT reform in a realistic concern is presented as follow,for instance,further improve the value-added tax system,accelerate the legalization of value-added tax,strengthen the management and service of value-added tax,and enhance the capacity of corporate accounting staff and etc.All these are serving the goal of enriching the local evidence for deepening VAT Reform,supporting VAT cuts action being positively carried,and most importantly fueling the stable and prosperous development for local economics.