Research On The Coordination Of Cross-border Interest Income Tax On "One Belt,One Road"

The "One Belt,One Road" initiative has brought new development opportunities for China and other countries along the route.In recent years,China has insisted on the key construction of the “ Belt and Road ”.Among them,the financial communication is an important part of the “Belt and Road” five-way.Cross-border financial communication helps “ going out ” enterprises to carry out overseas business activities,and the financial communication will involve Cross-border interest income.Moreover,because of the differences in tax systems among countries along the line,the competition between tax interests among countries,and the level of profit margins of credit investment business of Chinese enterprises are not high enough,the existing problems of cross-border interest income tax collection and reconciliation obtained from countries along the line cannot be ignored.Based on the“Belt and Road” as the background,this paper has defined the concept and policy of the“One Belt,One Road” cross-border interest income tax collection.It has adopted bilateral tax treaties as the starting point and selected multiple independents according to domestic tax laws and other international tax regulations.In the case,it analyzes the existing problems of the “One Belt,One Road” cross-border interest income tax collection.After the research of this paper,it is concluded that the existing “One Belt,One Road” cross-border interest income tax collection has the following problems: in the case of the bilateral tax treaty withholding income tax rate,the withholding tax rate is high,resulting in less tax benefits shared by our country.There is no tax benefit,and the cross-border interest income tax of enterprises is negatively high;there is a country difference in the withholding income tax rate,which may lead to the tax risk of“choosing tax avoidance”.In terms of tax exemption arrangements for bilateral tax treaties,the subjects enjoying tax exemption are not balanced,resulting in China's exclusive tax benefits;the lack of tax exemption for cross-border interest income of enterprises,resulting in less incentive for enterprises.Failure to sign bilateral tax treaties with all countries along the route has resulted in the country not sharing tax benefits,and the cross-border interest income tax of Chinese companies may be too heavy.Based on the problems analyzed by cases and theories,this paper proposes policyrecommendations for improving the coordination of cross-border interest income tax collection for the “Belt and Road”.First,comprehensively adjust the withholding tax rate for bilateral tax treaties.Secondly,in terms of tax-free treatment arrangements,the scope of the subject of tax exemption for the countries along the line should be expanded,and the tax concessions for cross-border interest income of Chinese enterprises should be granted.Furthermore,encourage bilateral tax treaties with all countries along the route.Finally,in order to ensure that the signed bilateral tax treaties are targeted,they should also form a model agreement suitable for the “Belt and Road”.The above suggestions are beneficial to China's tax authorities to make better tax coordination for the “One Belt,One Road” cross-border interest income.This will enable China to share reasonable tax benefits and reduce the cross-border interest income tax burden of Chinese enterprises.