Taiwan Income Tax Act contains two major parts: the Comprehensive Personal Income Tax and the Corporate Income Tax, while mainland China's Income Tax Law is divided into two parts: the Business Income Law and the Individual Income Tax Law. Taiwan's income tax rate is set at 17% ; mainland China's corporate income tax rate is 25 %. Taiwan implements an " imputation tax system" while China has no such tax system. Taiwan has implemented a provisional tax declaration system since September 1st of 2012; China has not such provisional annual reporting system. The impact of Taiwan's income taxation and China's corporate income tax over business management practices can be resumed in the following five points: 1. The level of taxation affects the surplus of corporate earnings after tax; 2. The level of taxation has an impact on after-tax earnings of the shareholders, employees‘ end of year bonuses and reward systems 3. Taxation levels affect the level of corporate working capital. 4. The level of taxation and its complexity affects the decision of foreign investors to invest in local industries. 5. Tax incentives affect the flow of foreign capital movement in the domestic industries and the practices of domestic business enterprises. The tax systems in both sides of the strait are very complex, not only ordinary citizens or companies are flabbergasted, but also professionals in the accounting industry need to perform in depth research in order to understand these difficult international taxing schemes. The result of this confusion causes tax authorities in both China and Taiwan to seek unnecessary taxes to be levied as well as recurring to lengthy corporate tax litigation. Thus revising and researching the tax laws in both countries deserves further study and review.