Research On The Special Tax Treatment Of Income Tax Policy Of Enterprise Merger And Acquisition

Under the trend of supply-side reform and industrial structure optimization and upgrading promoted,the pace of enterprise mergers and acquisitions(“M&A”)has been accelerating.More and more company are emerging for M&A in China.Merger and acquisition is a key way and effective way for enterprises to integrate resources,expand business scope and optimize capital allocation.And taxation is an important factor which will affect the efficiency and results of M&A.Among all the taxes involved in M&A,income tax is the most complex and significant,which directly affects the decision of M&A.For example,the choice of merger mode,merger type and payment mode.It is of great significance to discuss the existing problems in the income tax policy of mergers and acquisitions,especially in the special tax treatment,and put forward some suggestions for improvement,so as to promote the development of China’s M&A market and encourage company to carry out mergers and acquisitions.This paper mainly studies the policy and operational problems in the special tax treatment in enterprise M&A,as well as the suggestions of improving.Firstly,it combs the income tax policy of M&A,focusing on the content of policy changes.From the perspective of policy-making principles,this paper analyzes the current policies.Secondly,it analyzes the market data of M&A from 1999 to 2018.It is concluded that the changes in the scale and quantity of M&A before and after the release of policies,and the sensitivity of the market to different policy changes of the market.Starting from each condition of the special tax treatment policy of income tax,this paper studies the problems in the implementation and design of policies in the merger and reorganization of enterprises.In addition,through data statistics,it is concluded that the scope and quantity of M&A suitable for special tax treatment are small.By introducing the typical case of company A,the paper deeply analyses the effectiveness of different tax treatment.Starting from the analyses of the case,the paper summarizes the problems from three levels,legal level,tax policy design,tax administration,and puts forward suggestions for improvement.Suggestions are made to expand the scope of application of enterprises,improving the legal level of income tax policies for M&A,perfecting the details and implementing rules of special tax treatment policies.And reducing the two quantitative conditions of special tax treatment include the proportion of equity payment and transfer of equity(assets)ratio,expand the business scope,and promoting more company to carry out mergers and acquisitions activities,so as to rapidly promote industrystructural upgrade.Based on the research of enterprise income tax policy of M&A,especially the problems existing in the special tax treatment.The paper starts with the case analysis,combines the data changes of merger and acquisition market in the past ten years and the survey of the universality of the problems,so as to make the problems more specific,and then puts forward practical suggestions from the perspective of government policy-making.