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Taxation
Before the reform and
opening, China exercised a single taxation system. Because taxation
had no connection with the economic activities of enterprises, this
system lacked vitality. In 1981, the Chinese government began to collect
income tax from Sino-foreign joint ventures and solely foreign-funded
enterprises, taking the first step in taxation system reform. From
1983 to 1984, the reform consisting of the replacement of profits
by taxes was carried out in domestic enterprises, and a foreign-related
taxation system was set up. As a result, instead of a single tax category,
a compound taxation system in which turnover and income taxes were
the mainstay and other tax categories were in coordination with it
was initially in place and promoted the control of finances and the
economy. In 1994, the reform of the taxation system was deepened,
and a complete structural adjustment of the taxation system was made
by taking the market economy as the norm. In 1996, China lowered the
rate of Customs duties and export drawback, and exercised import supervision. |
