Bilateral Tax Treaties And China's Direct Investment In Countries Along The “Belt And Road”

We are now living in an era of connectivity and increasingly close international economic ties.With the support and promotion of relevant policies,China's foreign trade is booming.More and more enterprises are taking the step of "going out",entering the global market and achieving the output and the integration of capital and technology.Chinese enterprises have gradually acquired initiative and voice in the international trade market.Their international competitiveness has improved significantly,and their outbound investment has reached new highs.At the same time,the "One Belt And One Road" initiative was vigorously carried out,and more and more countries have joined the "One Belt And One Road" circle of friends.In the current complex and changeable international trade environment,it undoubtedly provides important opportunities for the further development of China's foreign investment.However,the cross-border investment activities of enterprises are bound to cause problems related to international tax arrangements.As a legally binding international agreement,a bilateral tax agreement establishes the principle of taxation,the jurisdiction of taxation and the elimination of double taxation through equal consultation between the contracting parties,promotes the optimal allocation of capital in the global scope,and creates conditions for the settlement of tax-related disputes faced by enterprises outside the country.Under the background of the current "One Belt And One Road" initiative,relevant studies are conducted on the incentive effect of tax agreements on OFDI of Chinese enterprises,which is of certain guiding significance for China to continue to promote the negotiation and signing of tax agreements and the promotion of "One Belt And One Road" investment.Based on the theoretical basis,the paper analyses the tax treaty and China's OFDI conduction mechanism,and uses OFDI data of "One Belt And One Road" countries from 2003 to 2017,and the empirical analysis was made on the OFDI data of "One Belt And One Road" countries by using PSM propensity score matching and Tobit model.At the same time,this paper studies two kinds of heterogeneity from the perspective of tax concession clause and national tax system structure.The results show that the signing of tax agreement has a positive promoting effect on China's OFDI,which is significantly influenced by the presence or absence of tax concession clauses and the heterogeneity of national tax structure.The promotion effect of tax agreement with tax exemption clause is higher than that of tax agreement without tax exemption clause.The agreement signed with the economy with commodity tax as the main tax category has a higher and more significant environment has a negative regulating effect on the promoting effect of tax agreement.Based on the research results,some Suggestions are given in this paper.