The US Senate passed the tax reform bill by 51 votes to 49 on Saturday morning (December 2, 2017, U.S. time), which will be the largest tax cut act in US history. It is also the first time that the US Congress has reformed the tax law in the past 31 years. The approval of the tax cut bill moved one step closer to the goal of the Republicans and Trump administration, namely, to significantly reduce the taxes payable by businesses and the wealthy and bring about a series of changes to the American people. Under the Tax Reform Act, the US corporate-tax rate will be greatly reduced; personal income tax and other tax systems will be simplified; many existing project-based tax reduction methods will be eliminated; and a low-rate lump sum tax will be imposed on US enterprises that transfer back their overseas assets. For example, the US corporate income tax rate has been reduced from 35% to 20%, and business owners are allowed to deduct 20% of their corporate income. In the current context of economic globalization, policy changes in various countries will impact global economy, especially for the US, the world’s largest economy, this tax reform bill will have a huge impact on the rest of the world. For China, the world’s second largest economy, its economic development will also be greatly affected by the US tax reform. Issues such as the impact of US Tax Reform Act and China’ response require further study. This week, Professor Liu Zhibiao, Dean of Yangtze IDEI, held discussions the first time with relevant experts and scholars on the topic “US Tax Reform: China’s Response”.
