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1) Establish the international tax policy research center
G20 leaders in Hangzhou summit put forward a communique, China will establish a research center whose aims are carrying out the international tax policy design and research of the international tax policy in the future. The topic was about tax legislation, tax system, tax policy topics, international taxation research center, which will be advantageous to the BEPS implementation in China.
2) Release the final BEPS report
In July 2013, the organization for economic cooperation and development (OECD) issued 15 action plans about the response to the tax base erosion and transfer of profits (BEPS). Within the two year after the plan was released, the OECD published many reports and drafts, in order to provide advice to those countries participated in the BEPS project to implement the plan. The BEPS era is the time period to carry out the BEPS action and it will last to 2020.
China state administration of taxation issued the final report of tax base erosion and profit transfer (BEPS) project in 2015, adding anti-avoidance clauses in the tax administration law and individual income tax law revision. It provided legal basis for closing the loopholes in tax, introduced the results of BEPS in negotiating, signing and revising an agreement gradually.
3) Introduce the policy of anti-tax avoidance
In 2015, Administration of Taxation issued “the general anti-avoidance measures for the administration”. In 2016, the Administration of Taxation combined the results of BEPS, issued “new measures for the implementation of the special tax adjustments”, and a series of major policies. All levels of tax authorities will look into the relevant impacts of the policy of tax collection and administration, the enterprises’ operation behavior and other various aspects to carry out the system effect analysis. Therefore, it will provide guides to the policy-making and ensure the scientificity and the rationality of the policy.
4) Establish multinational enterprise profit index monitoring system
China established separated divisions, regions, annual, investment of multinational enterprise profit level indicator monitoring system, monitoring the multinational company profit level which can help china prevent the profit transfer to other countries or regions.
