A Study on the System of Corporate Income Tax for Supporting the Small and Medium-sized Enterprises of China

Globally, the importance of small-sized enterprises in the development of national economic development becomes significant. In major countries like U.S., etc., small-sized enterprises contribute more than 95% of the whole enterprises of the country’s development. Since the Chinese open economic, small and medium-sized enterprises in China contribute significantly on continuous development of national economy. According to national statistics of China, number of registered small and medium-sized enterprises already exceeds 10 Million, which comprises 99.8% of total registered enterprises. Total assets value of industrial small and medium-sized enterprises is 60%, and the income and tax is 40% of national statistics. Not only small and medium-sized enterprise provides around 75% of employment opportunity, but also contributes increasing of number of newly employed by 90%. In addition, 60% of total export is from small and medium-sized enterprise. Small and medium-sized enterprise contributes significantly on the development of Chinese economic growth and social development and the growth in the number of small and medium-sized enterprise and increase in an output become the new growing point of Chinese economy. Chinese government currently supports small and medium-sized enterprise through various tax support policies. However, in order to increase the effectiveness of tax support policies, government needs to verify appropriate target for the policy and to develop simplified and comprehensible tax support system. Also, education and promotion on tax system for small and medium-sized enterprise should be strengthened.