Fill In Tax Depressions: Preferential Policy Clearance And Pfer Payment

In recent years, in order to promote the development of regional economy, some regions and departments have implemented preferential policies (such as preferential taxation policies) for tax revenue, non tax revenue and financial expenditure for specific enterprises and their investors (or managers). Some preferential policies such as taxation have disrupted the market order and affected the effect of macroeconomic regulation and control policies.

For the clean-up of this preferential tax policy, the Ministry of finance's request for regional reporting will be included in the comprehensive evaluation system of local fiscal management performance in 2015 as an important evaluation factor.

The Ministry of finance organizes annual comprehensive evaluation of the performance of local financial management in the previous year, and the evaluation results are important reference for pfer payment allocation.

"Some places, in order to attract investment, violate the provisions of the tax law, and formulate some preferential policies that are applicable locally. Because the tax legislative power is highly concentrated on the State Council and the National People's Congress, the situation of direct tax relief by local governments seems to be rare. However, in the name of fiscal expenditure, there are still some tax deductions in disguised form.

Wang Dongsheng, President of the tax network tax office, told the economic observer.

The above practices, to a certain extent, affect fair competition in the market, and at the same time lead to tax laws being changed in disguise.

In recent years, the more economically backward areas, the greater the pressure of attracting investment through this way, the stronger bargaining power of some large investors.

Based on this, the Ministry of finance has made efforts to clean up the standard preferential tax policies.

This reporter has learned that the Finance Department of central China has pferred the budget department of the Finance Bureau of the province to the provincial office to collect preferential tax policies.

The Budget Office of the provincial finance department told the Economic Observer newspaper that the rule of clean-up is to clean up preferential policies for taxes and fees, including preferential tax policies, preferential policies for financial system, payment of social security premiums, discounts and other concessions.

Local municipalities have reported their preferential policies in the second half of 2014. The policy adopted in this clean-up policy is to forgive and forget the past, but gradually clean up after cleaning up.

The Provincial Department of finance budget office told reporters, "the biggest impact is in the Development Zone registered The Virtual Corporation, used to tax enterprises.

It also caused a wait-and-see trend, and the park did not dare to talk with the enterprises, nor did the enterprises dare to set up the park.

Wang Zecai, a researcher at the Ministry of Finance and the Institute of Fiscal Science, thinks that preferential policies such as cleaning up taxes and so on, from a unified tax system, a unified market and a fair tax policy, undoubtedly play a role in the establishment of a modern financial system, especially the tax system and the purification of the tax environment.

In Wang Zecai's view, since the reform and opening up, all localities have set up state-level development zones or industrial parks. These areas have introduced some preferential policies, resulting in man-made policy depressions.

"Therefore, the formulation of preferential policies should be considered in a comprehensive way, and certain industries and regions should be given a buffer zone."

Wang Zecai said.

The director of investment in a development zone around Beijing told reporters that "cleaning concessions will definitely have an impact on us.

The two part of the enterprise cost is part of the tax revenue, and the other is the non tax cost. For example, the two costs of the enterprises in Beijing are 50, respectively, which may be reduced to two below the periphery of Hebei.

In fact, the newly opened companies around Hebei also need to increase the cost. The original cost can be offset by the lower cost. Now that the tax preferences are gone, the investment will be even more difficult.

Especially because of the problem of tax burden.

"

After the preferential tax clearance, how does the less developed areas attract enterprises to enter? For example, matching, upstream and downstream resources are not as good as Beijing, and my advantage land prices and rents can not exist as a preferential tax policy, can I adapt to the existence of industry support policies? "The person in charge of the above Development Zone told reporters.

Wang Dongsheng believes that for investors, if the preferential policies of local governments are based on decision making when making investment decisions, if these preferential policies are abolished, they may suffer losses.

Especially for listed companies, if the profits are affected by the tax after the return, the stock price will be affected.

At the end of 2013, in the third Plenary Session of the 18th CPC Central Committee, "clearance norms" were explicitly demanded.

Policy.

In December 9, 2014, the State Council issued further clarifying regulations on preferential policies such as various taxes, and stressed that all regions and departments concerned should conduct a special clean-up, and submit special cleanup to the Ministry of finance before the end of March 2015, and the Ministry of finance will report it to the State Council.

At the end of September 2014, the State Council, in the decision on deepening the reform of budget management system, clearly stated that, apart from special tax laws, regulations and State Council regulations, all departments drafting other laws, regulations, development plans and regional policies must not break through the unified national fiscal and taxation system and stipulate preferential tax policies.

The notice of the State Council on "cleaning up and standardizing the preferential policies for taxation" emphasizes that "any policy of breaking the law or affecting fair competition must be included in the scope of clearance."

In formulating preferential policies for various types of taxes, the State Council has issued a circular calling for the following: first, unify the tax policy making authority and adhere to the statutory principle of tax revenue; except in accordance with the special tax laws and regulations and the administrative authority of Taxation stipulated in the law of the People's Republic of China on regional national autonomy, all regions shall not formulate tax preferential policies on their own.

Third, strict fiscal expenditure management.

The notice said that the financial expenditure on illegal and illegal development should be linked to the tax or non tax revenue paid by enterprises and their investors (or managers).

It should be abolished in the form of return and collection, payment of financial rewards or subsidies, and the reduction of land pfer income in the form of payment or subsidies.

The circular requires that the provincial people's governments and relevant departments should submit to the Ministry of finance before the end of March 2015 the special clean-up of preferential policies such as taxation in the provinces (autonomous regions, municipalities) and their departments, which shall be reported to the State Council by the Ministry of finance.

In addition, the notice also said that the inter ministerial joint conference system of preferential tax policies such as tax clearance, led by the Ministry of finance, should be established.

"Tax incentives involve many aspects. Some are tax base concessions, such as agriculture, forestry, animal husbandry and fishery. Some are preferential tax rates, such as small and micro businesses enjoying tax preferences.

In fact, many preferential policies formulated by the local authorities are largely useless.

A director of the State Administration of Taxation told the economic observer.

The director of the Inland Revenue Department said that the local tax preferences were more numerous and more chaotic, so Lou Jiwei, the Minister of finance, said that we should clear up the tax concessions. When we were carrying out, we looked at the documents issued by the General Administration of Taxation (State Administration of Taxation) and the official texts formulated by the provincial governments.

This preferential tax policy has been cleared up, and the Ministry of finance has requested the reports from all regions to be included into the comprehensive evaluation system of local fiscal management performance in 2015 as an important evaluation factor.

The comprehensive evaluation system of local financial management performance is a set of index system issued by the Ministry of Finance in the first half of 2014.

The main purpose is to urge and guide local governments to deepen the reform of fiscal and taxation systems, establish modern financial systems, improve budgetary management systems, strengthen and improve post event supervision, improve the efficiency of financial management, and promote the modernization of national governance systems and governance capabilities.

The Ministry of finance organizes annual comprehensive evaluation of the performance of local financial management in the previous year, and the evaluation results are important references for the pfer payment allocation.

This means that the initiative to clean up preferential policies will be linked to the pfer of payments in the future.

"Linking with budget scale and pfer payment is a relatively scientific basis for considering the comprehensive factors in a realistic way."

Wang Zecai thinks.