First, the impact of the camp reform increase on the building construction enterprises

(a) the impact on the tax burden of the construction enterprises

After the conversion of the business tax to value-added tax in the construction enterprises, the first thing that is involved is the deduction of input tax credits. For example:

Taking a building construction enterprise as an example, assuming that its project gross profit rate is 10%, the project settlement cost, raw materials account for about 55% (cement accounts for about 45% of the cost of construction materials, steel accounts for about 40%, and other materials account for about 15%), the labor cost accounts for about 30%, the machinery use fee is 5%, and other expenses account for no more than 10%, assuming that its annual completion of the operating income is 111 million yuan, operating costs of 99.9 million yuan (operating income and costs are inclusive of VAT).

Before the camp reform, the business tax payable is 3.33 million yuan (11,100 × 3%).

After the camp reform, labor costs cannot be deducted from input tax, so the amount of input tax that can be deducted is 8.7 million yuan [9990 × (55% + 5%) ÷ (1 + 17%) × 17%] output tax is 11 million yuan [11100 ÷ (1 + 11%) × 11%] (Note: In November 2011, the State Council approved the Pilot Program for the Reform of Business Tax to Value-Added Tax (VAT)) (Cai Shui [2011] No. 110), and the VAT rate applicable to the construction industry in the program was changed to 11%...) Thus, the VAT payable is 2.3 million yuan (1100-870), and the tax burden of the building construction enterprise has decreased.

The above is the theoretical algorithm, but in practice, the characteristics of the building construction enterprises will bring many challenges to the calculation of VAT, such as, more ways of sources of construction materials, the difficulty of VAT input tax deduction, due to the difficulty of invoice management, a lot of materials input tax can not be properly deducted, so that the actual tax burden of the construction industry increased. According to the Circular of the Ministry of Finance and the State Administration of Taxation on the Policy of Applying Low VAT Rates and Simplified Methods of Collection of VAT on Some Goods (Cai Shui [2009] No. 9), general taxpayers selling the following self-produced goods may choose to follow the simplified method in accordance with the 3% levy rate (Note: According to the Circular of the Ministry of Finance and the State Administration of Taxation on the Policy of Simplifying the VAT Collection Rate, dated June 13, 2014) (Cai Shui [2014] No. 57), since July 1, 2014, the implementation of the 3% levy rate, the original levy rate of 6% is no longer applicable) to calculate the payment of value-added tax: ① construction and production of building materials used in sand, soil, stone; ② to their own extraction of sand, soil, stone or other minerals continuously produced bricks, tiles, lime (excluding clay solid bricks, tiles); ③ water; ④ concrete (limited to cement as raw material for the production of cement concrete); ③ water; ④ concrete, concrete, concrete, concrete, concrete, cement, cement, cement, cement, cement, concrete and concrete, concrete, concrete and concrete. (limited to cement concrete produced from cement as raw material). The goods listed above are the main materials of the project and account for a large proportion of the project cost. Assuming that construction enterprises can obtain formal VAT invoices for the purchase of the above materials, and that the deductible input tax rate is 3%, while the output VAT rate for the construction industry is 11%, the above materials purchased by construction enterprises will definitely increase the tax cost by 8%, thus increasing the actual tax burden of the construction industry and crowding out the profit margin.

Since the machinery and equipment purchased by enterprises can deduct VAT input tax, it is conducive to enterprises to improve the equipment level of machinery and equipment, building construction enterprises through the introduction of new machinery and equipment, reduce the labor cost of operators, for enterprises to update their equipment, and expand the scale of operations to provide a powerful condition, while the improvement of the level of mechanical operations can reduce the occurrence of major accidents in the construction, and promote safe production, and ensure the safety of operators. Ensure the safety of operators' lives.

(2) the impact of cost management and accounting

One is the construction unit bidding budgeting will be a major change in the corresponding design estimates and construction drawings budgeting should also be implemented according to the new standards, the content of the public tender issued by the outside world should also have corresponding adjustments.

The second is that this change makes the construction enterprise bidding work becomes complicated. For example, the preparation of the tender about raw materials, fuel and other direct costs do not include VAT input tax, the actual construction, the preparation of the tender is difficult to accurately predict how many costs and expenses can obtain VAT input tax.

Thirdly, due to the implementation of the new quota standard, the construction budget of the enterprise needs to be revised, and the internal quota of the enterprise also needs to be compiled again.

(C) Impact on business forms

The change of business tax to VAT is conducive to curbing the phenomenon of illegal subcontracting and sub-subcontracting. Some enterprises will subcontract all the works to others after contracting the works, which is expressly prohibited by the construction law. In the case of subcontracting all the works, the construction enterprise as the first contractor (the unit that undertakes the works from the contracting party) shall calculate and determine the sales and output tax according to the whole works settlement income and out-of-the-price expenses obtained from the contracting party, and obtain the VAT special invoice as its input tax from the second contractor (the unit that undertakes the works from the first contractor). VAT special invoice as its input tax, from its account processing can be found no deductible purchased materials, so it is easy to determine the substance of the transaction of the project all subcontracting. Article 29 of the Construction Law stipulates that "the general contractor is prohibited from subcontracting the project to a unit that does not have the corresponding qualifications", if the subcontracting unit is a small-scale taxpayer or contractor, the offsetting input tax will be significantly reduced, the enterprise's tax burden will increase, and the profit will also be reduced. Once the tax authorities recognized as illegal subcontracting or illegal subcontracting, the first contractor will be prohibited from deducting input tax credits, the first contractor's tax burden will greatly increase, profits will be greatly reduced, for the profit margin was not much of the building construction business results of the impact of a larger, which will be the illegal subcontracting behavior to play a role in curbing.

Another common form is to rely on, at present, many rely on the unit to buy materials do not invoice, material purchase price is lower. After the tax reform if you do not issue VAT invoices, the dependent unit will not be able to get the deductible income, the tax burden will increase, if you issue VAT invoices, there must be a real transaction, the material suppliers will often take advantage of the price increase, the dependent unit profits will be greatly reduced, which will seriously crack down on the behavior of dependence.

For affiliate projects, since the business tax has basically no relationship with the cost and expenses, and the business tax is levied on the basis of the total cost of the project, and there is no tax deduction, the affiliate partners often do not have a sound accounting system and do not have the consciousness to ask for invoices. After the implementation of value-added tax, value-added tax is inextricably linked with the project cost and cost. If the joint venture cooperation project can not obtain enough VAT invoices in procurement, leasing, subcontracting, etc., the VAT input tax will be very small, the deductible tax will be less, the tax paid will be more, and the tax burden will even exceed the project's profitability, the general contractor and the joint venture cooperation party will have no profit, and the risk of tax-related risks will threaten the survival and development of the joint venture cooperation project management mode.

(4) Impact on enterprise management

Construction enterprises' construction projects are scattered all over the country, the geographical area of material procurement is also dispersed accordingly, and the material management departments are many and miscellaneous, and each procurement business has to issue VAT invoices in accordance with the existing VAT invoice management mode, and the quantity is huge, and it is difficult and time-consuming to collect, audit and organize the invoices. According to the current system, input tax should be certified within 180 days, and its work is very difficult. The reality of tax issues is not as simple as the theoretical analysis, such as getting the other side of the invoice, should pay attention to whether the special invoice, the invoice on the time, whether the invoice chapter is correct. These undoubtedly put forward higher requirements for the financial personnel of construction enterprises and even the staff of operation departments. In addition, the business tax and VAT have different tax payment locations, and the tax payment locations of construction enterprises will also change significantly due to their business characteristics.

(E) Impact on Financial Accounting

Since the cost of raw materials, auxiliary materials and other inventory purchased by building construction enterprises and fixed assets such as machinery and equipment need to be deducted from the input tax according to the VAT invoices they obtain, so that the total assets of the enterprises will be reduced by a certain margin compared with the total assets before the BAT, which will lead to an increase in the asset-liability ratio.

For the financial statement of the enterprise, before the reform and increase, the main business income contains business tax, belongs to the amount of income with tax, after the reform and increase, the main business income does not contain VAT, belongs to the amount of after-tax income, due to the two different methods of calculation, the enterprise's profitability value is also different, assuming that the enterprise in the implementation of the business tax and VAT revenue and the actual tax burden is equal to the camp after the reform and increase there will be The phenomenon that the business income of the enterprise decreases while the profit margin increases.

The impact on enterprise cash flow. As the building construction enterprises generally implement the withholding and payment of business tax, when the construction unit accepts the price of the work, it takes the direct withholding of business tax from the price of the work and payment, after the camp reform increase, the construction unit will not be able to directly withhold and pay the VAT, and directly by the building construction enterprises to pay the VAT to the tax authorities in the current period, but at this time, the construction unit accepts the price of the work and doesn't pay the project payment to the building construction enterprise immediately, that is to say The payment of VAT comes before and the collection of project payment comes after, sometimes with a long time lag, which will lead to an increase in the net cash flow of the enterprise's operating activities and an increase in the degree of financial constraints of the enterprise.

Two, building construction enterprises on the camp reform response measures

(a) Strengthen the management of input tax credit link

Construction enterprises in order to reduce the construction cost, often choose individual, small-scale taxpayers as a partner in the supply of materials, machinery and equipment leasing. Now, due to the tax reform, construction enterprises should pay more attention to selecting partners with the qualification of value-added taxpayers, and should examine their corresponding deduction rates, obtain VAT invoices, and improve the input tax credit problem, so as not to be unable to offset enterprise value-added tax. After the change of business tax to value-added tax, the amount of value-added tax directly depends on how many special invoices for value-added tax can be provided by the building construction enterprises for input tax credit. Therefore, the higher the input credit part that the enterprise can provide, the lower the amount of VAT paid will be. For example, increase the purchase of machinery and equipment, and reduce the expenditure on labor services. Building construction enterprises need to strengthen the company management from now on and pay attention to keeping and collecting the corresponding VAT input credit vouchers. Moreover, many unexpected problems will occur in the pilot implementation stage, and construction enterprises should focus on the main reasons for not being able to input tax invoices, and enhance the awareness of plugging the leakage from their own management in order to minimize the loss.

(2) Cultivate tax talents and do tax planning

At present, some large-scale building construction enterprises have already stocked up tax planning talents in advance to do research on relevant tax policies and carry out reasonable tax planning. Enterprises should start from the characteristics of construction enterprises and value-added tax (VAT), carefully study the relevant provisions of the new policy, and especially master the special provisions for this industry. Through meetings, internal newspapers and websites, they should preach professional knowledge about VAT to the financial staff, enterprise management personnel, material purchasing personnel, and budgeting personnel, and enhance the staff's understanding of the basic principles of VAT, tax rates, tax links and tax requirements. They also cultivate the awareness of asking for special invoices in the procurement of materials and subcontracting to ensure that they are able to operate and utilize them proficiently immediately after the tax reform.

The impact of business tax to value-added tax on building construction enterprises is extensive and profound, involving all aspects of enterprise management, especially involving the law, financial management, accounting and other important aspects of the enterprise in this regard, the enterprise should provide sufficient talent support to ensure that the enterprise tax legal compliance. Legal advisers should study the relevant tax laws and regulations, tax policy, financial accountants should do a good job of accounting for tax accounting work. Enterprises should be appropriately equipped with tax planning personnel when necessary, to carry out reasonable tax avoidance, tax saving, fully enjoy the tax reform to the enterprise tax dividends, and to achieve zero risk tax-related.

(C) strengthen the internal management of enterprises, standardize the way of business

Battalion change, to the management of building construction enterprises put forward higher requirements, as a legal personality of the building construction enterprises, from the company's organizational structure, the establishment of subsidiaries and branches, and development strategy and major investment and financing projects to make the corresponding adjustments. For example, in the bidding work, enterprises often bid externally in the name of the group company, and then break down to the group after winning the bidding. Member enterprises with legal personality shall sign subcontracts with the group company, and the income obtained shall pay VAT in the place where the member enterprises are located and provide the VAT invoices to the group company; and all the incomes obtained by the group company from the construction unit shall be deducted, including the VAT paid by member enterprises, and the input tax shall be paid by the group company in the enterprise after the input tax is paid. The VAT shall be paid at the location of the enterprise's organization after the input tax is included, and neither the construction unit nor the group company can withhold and pay the tax on behalf of the member enterprise. As mentioned before, the camp reform is easier to realize the supervision of illegal subcontracting, subcontracting, affiliation and joint projects and other business methods. Building construction enterprises should standardize the way of operation to avoid legal risks.