The Expected Effect of Extending VAT Tax Base Reform on Industry Tax Burden

Extending VAT tax base reform will affect the turnover tax burdens of various industries.Using input-output table data,the paper analyzes and computes the influences of extending VAT tax base reform on turnover tax burdens of value-added tax industries(industries imposed value-added tax currently) and business tax industries(industries imposed business tax currently) respectively.The results show that firstly,the overall tax burden of value-added tax industry will have a small decline and the service intermediate input ratio is the key factor determining the scale of tax reduction effect;secondly,tax burdens of various business tax industries differ a lot with most industries enjoying tax reductions including business services industry while some industries suffering tax increase such as rental industry,and the choice of value-added tax rate for reform industries and the intermediate input ratio will determine the tax burden change of business services industry.In order to promote fair tax burden between industries and reduce the negative effect of extending VAT tax base reform on industry development,it is necessary to reduce the tax rate of rental industry and transportation industry to some extent.