Therefore, the tax-sharing reform of 1994 is actually a great change based on the current situation that the central government is short of money and the local governments are rich, and based on the institutional restrictions at that time. Taxes are also divided into three categories: central tax, local tax and * * * tax. Because China's tax system has a very important feature, which is mainly turnover tax, accounting for 70% ~ 80% of all taxes before 1994. Turnover tax is mainly composed of value-added tax, business tax and consumption tax. At that time, value-added tax accounted for about half of the total fiscal revenue. Therefore, after the tax-sharing system, the value-added tax has become a * * * tax, with the central government accounting for 75% and local governments accounting for 25%. Business tax is local tax and consumption tax is central tax.
At the same time, the tax collection and management system was reformed. All local governments in China, including provinces, cities and counties, have set up a set of vertical collection and management institutions subordinate to the central government, namely People's Republic of China (PRC) State Taxation Bureau, which is responsible for the collection of central taxes and * * * taxes, and local taxation bureaus are set up below the provincial level to be responsible for the collection of local taxes. At that time, there were 1 10,000 employees in the whole tax system, among which the staffing funds of the national tax system and the appointment and dismissal of cadres were managed by State Taxation Administration of The People's Republic of China.
Although People's Republic of China (PRC) State Taxation Administration of The People's Republic of China is under the vertical management of the central government, it has been in one place for a long time, and it is more or less entangled with the local government, so it is easily influenced by the local government. In order to avoid local governments' interference in the national tax work, since 1998, China has implemented the exchange system of national tax directors in different places, which has improved the independence of the national tax system, safeguarded the authority of the tax law and played a positive role in ensuring the central fiscal revenue.
Therefore, at that time, the national tax and local tax were set separately to meet the needs of the reform of the tax-sharing financial system, especially the increase of two proportions, which played a very key role at that time.
After 2000, China carried out two major tax-sharing reforms, which narrowed the business scope of the whole local tax system. The first time was the reform of enterprise income tax sharing in 2002. Prior to this, corporate income tax revenue belonged to local governments and was collected by local tax bureaus. However, at that time, in order to support the strategy of developing the western region, the central government needed to further concentrate its financial resources, so it changed the enterprise income tax originally belonging to local finance into * * * tax, and in 2003, the central government accounted for 50% and 60%, so from this time on, the enterprise income tax became * * * tax. According to the national tax collection and management system, once it becomes a * * * tax, the tax collection will be transferred from the local taxation bureau to the State Taxation Bureau.
Of course, the biggest reform in China is the 20 16 reform, which is actually the reform of the central and local revenue sharing. After the reform, the business tax, the largest tax originally collected by the local taxation bureau, was cancelled and changed to the value-added tax collected by the IRS. The scope of national tax business has changed, but the scale of personnel has not changed, which has increased the pressure on the collection and management of national tax personnel. Therefore, the reform of these two major income sharing has become the most fundamental reason for the merger of national tax and local tax.
From a deeper perspective, behind the separation and integration, it is not only a major adjustment of the relationship between the central and local governments, but also a profound change in the national governance system and a major measure to promote the construction of a country ruled by law in China.
State Taxation Administration of The People's Republic of China and local governments.
Rights and obligations need to be clear.
China Newsweek: One of the important principles of the merger of national and local tax agencies is "slimming and keeping fit". How to understand this?
Liu Jianwen: One of the problems faced by "slimming" is that there were some overlapping institutions between the national tax and the local tax. For example, national and local tax authorities have collection and inspection agencies. Therefore, for tax cadres, slimming involves the issue of national placement, and will not be laid off because of the merger, but will be properly placed in the civil service system. This is the next issue that governments at all levels need to consider.
As for "fitness", my understanding is to integrate the elite heroes in the organization, better integrate resources, make the collection work more efficient, the organization and management more standardized, and the staffing more reasonable.
China Newsweek: At present, China implements the dual leadership system of State Taxation Administration of The People's Republic of China and local governments. How to evaluate this system and how will the two sides coordinate?
Liu Jianwen: The dual leadership system is not your business, but one person takes the lead. It is clear that after the merger, State Taxation Administration of The People's Republic of China, People's Republic of China (PRC) is the main company, and its listing in State Taxation Administration of The People's Republic of China, People's Republic of China (PRC) is also called the Taxation Bureau of XX Province (or city or autonomous region), and the staffing is also the responsibility of the central government, so local opinions may be sought on personnel selection.
China Newsweek: According to the current plan, the next step will be to merge at the city and county level. Will there be resistance in the middle, especially in areas with relatively developed county economy?
Liu Jianwen: I don't think there will be much resistance, because if the central finance is in charge, the original local taxation bureau should be very happy. After all, the economic situation varies from place to place. In underdeveloped areas, it may sometimes be difficult to pay wages, but after the merger, this problem does not exist.
As for the areas with relatively developed county economy, after the merger, the local power over enterprises will definitely be affected. But from another perspective, expanding the scope of tax collection and management can eliminate the information barrier between departments, strengthen the ability of tax collection and management, and realize the integrated collection and management of tax and non-tax revenue. In the long run, the combination of national and local taxes is conducive to the formation of a standardized and efficient tax system.
In fact, in the past, the collection rate of the local tax system was too low, which caused the disconnection between the statutory tax rate and the actual tax rate on the surface and impacted the authority of the tax law in essence. Once the authority of tax law is established, enterprises can't bargain with local governments in the process of tax payment, and they can also have accurate tax payment expectations. From the perspective of enterprises, corporate tax burden may increase. However, the central government is also considering solutions, especially the simplification of the value-added tax rate and the decline of the statutory tax rate, which can hedge the negative impact of the increase in the real tax rate.
In addition, this merger is also conducive to improving the country's tax structure and enabling future tax reduction policies to be implemented. The increase of collection rate is mainly reflected in direct tax, but the increase of direct tax will lay the foundation for the reduction of indirect tax in the future, thus improving the international competitiveness of China's tax system and is also a major reform of China's governance system.
In fact, I don't think the division between the central and local governments lies in who will collect it. Whoever collects it is the same. The question is what principles and rules will be used to divide the fiscal revenue between the central and local governments. So I don't think the merger of institutions will have much impact on the division between the central and local governments. I think it mainly depends on what ideas, principles and rules are used to deal with the financial relationship between the central and local governments.