The Current Main Problems and Countermeasures of Tax Preferential Policies to Encourage Innovation in China

China Business and Market - - CHINA BUSINESS AND MARKET - (Institute of Industrial Economics,CASS,Beijing100836,China) HU Wen-long

Abstract:At present,China has initially formed a series of tax preferential policies and measures,including corporate income tax,personal income tax,value added tax,tariff and consumption tax,which are mainly based on income tax and supplemented by turnover tax. The main tax preferential methods include tax rates cut,tax relief,deferred tax,pre- tax (plus) deduction,accelerated depreciation of fixed assets and other measures. Comparing to the requirement of innovation- driven development strategy in the new normal and the requirement of“encouraging people to start businesses and make innovation”, there are still some problems in China’s tax preference to encourage innovative,such as the lack of systematicness,the lack of diversification,not matching with the existing taxing structure,the more serious condition,and the not sensitive state- owned enterprises. To solve these problems,we should adjust the policy,improve the policy system,create the inclusive tax policy environment taking encouraging innovation as the orientation,improve the tax preferential policy for enterprises which taking encouraging innovation as the orientation,enlarge the coverage and enhance the support of such taxes as value added tax for encouraging innovation,enhance the tax preferential force for innovative professionals,and solve the ineffective and insufficient problem of tax preferential policy in encouraging innovation of state-owned enterprises.

Key words:encouraging innovation;tax preferences;tax policy;industrial policy

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