Essays on Taxation Law (compare The Australian Taxation System With The Chinese Taxation System) Essay

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Comparative Overview of Chinese and Australian Tax SystemTaxation in Australia has evolved since the year 1918 as the first tax on the imports of wine beer etc. It can easily be said that the Australian taxation system is an evolution of excellent imperative designs, where as in spite of being one of the oldest civilizations in the world Chinese taxation system only evolved from the year 1950 after formation of People’s Republic of China, Tran- Nam, (2002). The Chinese system of taxation is based on the two main considerations Transition to a socialistic market economyInternational market economy and the role of China in it. The Chinese tax system is very nascent and so evolution and reforms are still an ongoing process, Tran- Nam, (2002). Tax system in Australia developed through various phases and can be demarcated as Pre federation before 1901 where state taxes like customs duties, excise duties, income tax, land tax etc are introduced. Early federation from 1901 to 1941; Federal taxes were implemented like land taxes, excise, estate duty, sales tax etc and a parity and synchronization between State and Commonwealth taxes were introduced.

New Federalism era (1942 – 1979) here the apportionment of taxes between federal and states were carried out, the Federal government brought under its ambit income tax and land and payroll taxes were transferred to the states. Estate tax, gift duties, death duties were abolished. 1980 -1999 Major tax reforms took place during this time it included tax base broadening, income tax rates were cut down, self assessment was introduced and the tax law was much simplified, Tran- Nam, (2002). Year 2000 onwards an era of replacement of Wholesale sale tax by GST was introduced along with other reforms like introduction of Australian business number, business activity statement, pay as you go changes in CGT, reforms in business taxation etc. On the other hand Chinese taxation era can be classified into four periods like: 1949- 57 Taxation policies were unified and modern tax system introduced, like legislative power for taxation, tax types, collection methods rates etc were unified.

Year 1958- 1978 Simplification of Taxes 1979- 1993 Initial phase of reforms took place where in business tax system were introduced and profit taxing mechanism brought in place 1994 saw the era of major reform where new tax system was introduced it included VAT, individual income tax, enterprise income tax etc.

Zeng (2000). In case of China it is to be noted that only the central government has the constitutional authority to impose tax, local governments cannot impose any major tax through legislation except for minor local taxes. In Australia the scope is entirely opposite as it being a federation so both Federal and State governments can pass laws to implement taxes the Federal Government does so on the basis of Section 51(ii) of Commonwealth Constitution other important provisions on tax are mentioned in Sections, 53, 55, 88, 90, 92, 96 etc.

States also have concurrent power to legislate except retrained under Section 90 and 109 which grants the Federal Government exclusive rights, Tran- Nam, (2002). In Australia there are three main sources of law these are statutory law which are brought by legislatures in the Parliament, the second is case law which are created by any major decision of the Courts, there is this third source of informal law which is created by the ATO, it is developed as the Commissioner of Tax implements the law assuming that the taxpayers abide by the rulings of ATO and also their procedures etc, Tran- Nam, (2002).

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