| The paper is based on the fair efficiency theory and path dependence theory.The wholetext studied on six legal systems of individual income tax according to the whole legislationpath, tax system mode, tax payers system, tax base system, tax rate system, collection andlogic structure of legal relief system.Fairness and efficiency are always the fundamental of all taxes’ research and the onlystandard to judge a tax collecting success. Individual income tax has shouldered theresonsibility of the fairness and efficiency since its birth. Although the birth of the individualincome tax in Britain was due to the war and efficiency, after one hundred years ofdevelopment, the individual income tax has become the indispensable tax adjusting incomegap and balanced social polarisation between the rich and the poor. The concept of fairnesscan show more the essential of individual income tax.The individual income tax’s fairnessprinciples include the transverse and longitudinal.The former emphasizes that the same kindof person should pay tax the same tax.The latter stresses the person with different abilityshould pay differen tax. The individual income tax’s efficiency principles includeadministrative efficiency and economic efficiency,and it pay more attention to theadministrative efficiency. The individual income tax’s fairness and efficiency are the logicrelation of the dialectical unity.Of course, the modern tax theory development pays moreattention to the principle of fairness in research.Exploring the ways and paths of the Chinese32years tax economic adjustment,we found tax fairness and efficiency didn’t balance.Itseems fair, but as if putting the fairness to the margin or abandoning fairness.The practiceresearch shows that the current Chinese tax cannot adjust income gap very well. In general,itcannot change the income gap between the rich and the poor after collecting tax. The structureof collecting the individual income tax displays inverted pyramid shape. Although the currentindividual income tax tends to be regarded as the symbol of efficiency, not fairnesschoice.Even during the enforcement, the curren individual income tax can’t reflect the purposeof efficiency and also ignore the tax fairness at the same time.Thus,when correctly treating therelationship between fairness and efficiency,we should put them in the organic unity wherethey reconcile each other.Path dependence theory is the world influential theory that was put forward by a famouseconomist, Douglass North.He thinks that the choice of the initial path has great an effect on system reforming in the future. The new system reforming is a way of self-correction andperfect during the path developing,which is a kind of inertial effect in the path dependence.Path dependence theory makes great sense to study the development of China’s tax. Anyround of tax system reform may depend on the reform of the system or the initial pathchoice in the last round of tax system.During the1980-1992three tax law established the main system of the individualincome tax law. From the point of view of the path dependence theory, all of the system builtin the last twelve years was the initial choice of path.T he initial choice determines thedirection of path evolution. Reasonable system will be retained in the process of pathdevelopment and be strengthened and improved,such as the individual income tax’s taxadministration and administrative litigation system, tax declaration system, withholdingsystem, extra progressive tax system, expense deduction system,tax exemption system, taxpreferential system etc. The unreasonable system will be modified or abandoned during thepath development, such as single classification system mode, multifarious multistage ratesystem, rigid exempted from frontal system, the unfair tax payers rights protection system andnon-equilibrium legal liability system, etc. In any stage of the evolution of individual incometax,the jugement of fairness and efficiency are throughout path evolution. From three taxes’legislation background and the purpose of legislation to to all kinds of concrete systems,wecan infer fairness and efficiency. From the the original background of legislation,we can inferwhether individual income tax’s setting was to balance the rich and the poor or to achievethe efficiency of collecting financial.From the choice of the tax system mode,we can judge itbelongs to comprehensive mode that reveals fairness or belongs to the classification modelthat pays attention to the efficiency or belongs to binary mode which compromises theefficienc and fairness. From the tax base,we can judge all kinds of choices of the fairnessand efficiency on tax items distinguishing, expense deductio, tax exemption project. From thetax rate structure, tax level design, we can judge that we should consider more aboutefficiency or fairness. From the tax collection and management system,we can judge taxdeclaration, withholding publicans whether it helps tax collection and payment to workefficiently. From the tax legal responsibilities,we can judge whether the system of taxdistribute it fairly between tax payers and tax authorities or not. From the tax legal reliefsystem,we can judge whether it has protected the rights of tax payers effectively. It isbecause we clear up the evolution of individual income tax during the1980-1992from two aspects of the path dependence theory and fairness and efficiency choice,which make itpossible to analyse legislative evolution path under the perspective of fairness andefficiency from1993to2012.The overall reform of the individual income tax legislationexists mang difficulties, and the difficulties appears in the individual weak position,, thedifference of tax legislation, deliberative democracy legislation, and the individual income taxlegislation jurisdiction.There are mang solutions. This paper hold the point that we shouldpush China’s overall kinds of taxes structural design during the path of legislative reform, andincrease the proportion of the individual income tax; we should promote the individualincome tax’s legislation,maintaining being in conformity with the legislation of the centralgovernment, limiting the individual income tax area difference in legislation; We should alsosteadily promote whole reform of the individual income tax legislation, detail adjustment inthe normal tax legislation;we should continue carrying out the type of deliberative democracylegislation,encouraging tax payers to take part in the interaction of individual income taxlegislation.Reform of the tax system mode determines the direction of the reform of individualincome tax. In the1980s, three major personal taxes determined the mode of tax system oftheir respective in the initial path selection. In1980personal tax determines the classificationsystem model. In1986individual income tax levy of individual determines the singleclassified collection mode, and personal regulated tax is more suitable for qualitative asclassified comprehensive hybrid tax system pattern. When three tax reform in1993, theclassification mode of tax system was retained. Until today, twenty years later, China doesn’thave any real essential reform of classification mode of tax system. Based on tax law, in thethree mode of tax system, comprehensive income tax system model is most in conformitywith the principle of fairness, while the classification system is more conducive to theclassified tax collection and management, and benefits the realization of tax efficiency. Andthe classified comprehensive taxation model to some extent combines the advantages offormer two. Through the macroscopic and microscopic analysis, can be found, under theChinese current schedular system of taxation, the fair balance is unbalanced. Wage incomethat based on labor income accounts for the tax rate has been up to70%, while capital gainsmainly, dividends, interest and other main dividend income accounted for less than20%.Different taxpayers may lead to tax loss of vertical and horizontal equity through differentsubentry income, different income stream and different times of paying tax. The direction of chinese personal tax system mode reform has been determined as early as1995, in thenational planning level, classified comprehensive taxation model has always been determinedas the goal of reform. But more than10years, the reform only stay in the written planningstages. From the development trend of the tax system mode in the world, a simpleclassification of the tax system mode or the comprehensive income model is no longer onereform direction, and the aggregative model which mix the respective advantages ofclassification and comprehensive income tax system model has became many countries’ trendof the tax reform. Since chinese government has determined the classified comprehensivetaxation model in the national plans, they needn’t change the goals. Because according tochinese national conditions and actual situation of tax collection and management, integratedmodel, both aggregative model and single tax system model are not suitable for the currentsituation of chinese reform. Promoting the reform of the classified comprehensive taxationmodel should be gradual. In reform arrangements, we should classification beforecomprehensive, first "comprehensive" then gradually "comprehensive", and transit smoothlyto the income tax levy system that mainly of classification while comprehensive subsidiary.The main legal system of personal income tax has passed through a diversifieddevelopment process. In the1980s, three major personal taxes identified three kinds of legalsubjects, first, foreign nationality personnel subject of personal income tax in1980; second,individual industrial and commercial household subject of personal income tax in1986; andthird, Chinese citizen subject of individual income regulation tax in1986. These three kindsof tax subjects led to long and disorder management of taxpayers subject system to a certainextent, and also left space of the subject system reform. Under the effect of initial pathselection, the individual income tax law has abandoned the situation in which three taxsubjects acts of its own free will in three tax reform of1993, and adopted the internationalsubject system of resident and non-resident taxpayers. Identification of resident andnon-resident taxpayer mainly uses time and domicile. Domicile criterion contains threefactors: family, registered permanent residence and economic interest. The main distinctionbetween resident taxpayers and non-resident taxpayers is tax preferences. Overall,non-resident taxpayer enjoys greater preferential margins than resident taxpayers. In personalincome tax practice,the tax revenue ratio of resident taxpayers is significantly greater than thecontribution of non-resident taxpayers, but the contribution of non-resident taxpayersshouldn’t be ignored.32years of taxpayers subject system promote the development of personal income tax system to a certain extent, but it also has many problems. For example,marginalization of taxpayers subject system, non-conceptualization of resident andnon-resident taxpayers subject system, no-establishment of unified taxpayer identificationnumber system. In order to strengthen taxpayers subject system, the reform can be initiatedfrom several aspects: improving taxpayer bases; establishing a unified taxpayer identificationnumber; clearly defining resident and non-resident; reforming taxpayer identification rules,which can provide favorable conditions for the success of tax reformThe tax base of personal income tax mainly study in the scope of tax base, tax deductionand tax-exempt items. Adjusting the tax base is directly related to the horizontal and verticalequity of personal income tax, and as a system of tax incentives, exemption system to acertain extent concerns the incentive efficiency. For32years, the scope of tax base in theindividual income tax law was adjusted a lot. Setting the tax-exempt items are directly relatedto the expanding and shrinking of the scope of tax base, while the system of tax deduction isthe core of all past tax reform. In the1980S, three chinese major personal taxes determinedtheir respective tax base. Personal income tax determined six scopes of tax base in1980;individual income tax determined the scope of monomial income in1986and Individualincome regulation tax identified8scopes of tax base in1986. scope of tax base thatdetermined in the initial path selection of three major personal taxes of1980s directly affectunifing the scope of tax base in1993. Under the inertia of path dependence, the current taxlaw identified eleven scopes of tax base in total. After nearly20years, chinese tax base istending towards stability, but there are also some difficulties, the first is dilemma between thestable tax base and changing trend; the second is dilemma between the optimal tax-basetheory and the specific tax-base system. The third is predicament that how the currentpersonal tax reacting to income frome transfer of capital, income from inheritance and incomefrom virtual property in real life. As the response of reform direction, this paper think weshould advance the scope of tax base steadily, optimize the current project of tax base andincrease the capital gains or levy capital gains tax, and it also mentioned the right time to levyinheritance tax hasn’t come yet.Exemption system related to fairness and efficiency of personal tax practice, andessentially as a tax preferences system, has irreplaceable fair-showing efficiency in protectingdisadvantaged groups and people’s livelihood. On the other hand,the tax exemption in acertain period of time can promote the realization of some economic policy objectives. Three major personal taxes of1980s determined their respective tax-exempt items. In1993theunited personal tax law determined10kinds of tax exemption items. From1993to2012havebeen about twenty years, the legislative and administrative authorities have identified76tax-exempt items. Development of tax exemption system indicate that the basic theory abouttax exemption of current personal income tax law is diversified. In this progress taxexemption system has many predicaments in theoretical game between seriousness andflexibility. Seriousness in this predicament represented in whether the tax-exempt plan shouldbe limited to the basic legislation of legislatures; whether the authorized tax exemption of thecompetent tax authority should be reduced; the setting of tax-exempt items should beprincipled or concrete; whether local government should be granted certain rights of settingtax exemption; etc. Flexibility in this predicament represented in the term of settingtax-exempt items should be chronic or normalized; whether the standard of tax-exemptchanges should react to some changes of social forms or situation; the name setting oftax-exempt items should be fuzzy or clear, etc. In this paper, the way to react the troublemeeted in development of path is coordinating the seriousness and flexibility of tax-exemptsettings; homing the tax-exempt privileges to the legislature; reducing the tax-exemptprivileges of the executive authorities. And the design of tax-exempt items should be based onequity more than on efficiency.The reform and adjustment of the system of personal income tax deduction are the hotissues and the core of the tax reform in32years. Three major personal taxes of1980sdetermined the deduction system of quota standard and the deduction system of fixedproportional that be admited by the unified personal income tax. In the past20years of thesystem development, personal income tax have seted96deduction items from livelihood, costand special deduction.The current system of tax deduction depends on the reform of taxsystem mode directly. Practice in recent years shows that the current system of tax deductionhas five aspects of problem: First, game between itemized deduction and comprehensivededuction; Second, divorce between current deduction of working project and residents’actual consumption expenditure; Third, the too narrow scope of the items setting of livelihooddeductions; Fourth, the differentiation of the system of tax deduction; Fifth, no indexadjustment of standard deduction. As the key measures of reform, the system of tax deductionshould develope to comprehensive deduction. The solution is: First to push the mechanismwhich links standard deduction and per capita consumption expenditure; Second to expand the scope of livelihood deductions, to establish selective deduction system; Third tocompletely abolish the system of tax deduction; Fourth to set up the mechanism which hasindexation adjustment of standard deduction.There are two kinds of model of individual income tax rate from countries all over theworld.One is called the model of progressive tax rate,and the other is the model ofproportional tax rate.Using which kinds of tax rate model is all depends on the tax systemmodel in this country. On the whole, three major personal taxes of1980s adopted theclassification mode of tax system. This model directly determined the basic tax rate model ofChina, which adopt the model of progressive tax rate and the model of proportional tax ratesimultaneously. The initial path selection determined the dual tax mode until today.From1993to2012, the most active factor in chinese tax rate reform is the reform of the progressivetax rate in excess of specific amounts, which works with the adjusting of tax rate grades andthe tax rate spacing. In the tax reform of2011, there are some substantial adjustments to thetax rate grades and the tax rate spacing of wage income, individual income,income from leaseand contract of property, in which turned the level of wage income from9to7, and alsoadjusted corresponding tax rate at the same time. What’s more,it adjusted the per level of theindividual income. The tax rate model directly reflects the fairness of personal incom tax, andcan affects the realization of the efficiency of tax rate. Among them, the progressive tax ratein excess of specific amounts is recognized as the model that best embody the ability-to-payprincipal of taxation and the fairness of personal incom tax. Although the proportional tax ratehas some shortcomings in fairness, it’s functional efficiency is powerful, especially the lowproportional tax rate can more likely to promote the enthusiasm of tax payers to pay tax, andcan promote the formation of the tax culture. Reducing the rate grades and the level of tax rateis the trend of rate reform in the world today, which chinese tax reform also should conformto. In addition, the tax rate reform should involve: the adjustment of the highest marginal taxrate, disappearance of excess progressive, indexation, factors of family support and make adifference between capital income and labor income, etc. The paper believes that the reformof chinese tax rate should be adjusted to setting the indexed tax, borrowe the system of excessprogressive disappearance from abroad, and incorporate some factors such as family supportinto basic reason into the basic reason of tax rate adjustment. Only that, the reform of personalincome tax rate can adapt to the social economic states that changing constantly.The collection and administration system of personal income tax directly determines the efficiency of tax levy and ultimately affect the fairness of tax practice. Three major personaltaxes of1980s determined the system of whithhoulding at source and tax declaration in theinitial path selection. But because of the decisive influence of Chinese classification mode oftax system, these two kinds of system developed unbalanced at the beginnig of initial pathselection. The system of withhold and remit tax has developed and gradually become the mostimportant collection and administration system of personal income tax. While the system oftax declaration haven’t become the subject system of personal income tax till now becausechinese taxation culture is undeveloped and the system of personal income tax is deficient. Inthe process of path development, the system of tax declaration of more than120000yuanannual income was emerged. This system to a certain extent maked up the situation that thesystem of tax declaration developed unbalanced, but didn’t reach the expected goal of levyingor retrieve the situation where the system of tax declaration has weakened by the sucssece ofwithholding system.The system of legal liability is an important supporting system to impel levy taxefficient. Three major personal taxes of1980s determined their respective legal liabilitysystem which belongs to a general system. When the law of individual income tax was unifiedin1993, the legal liability system no longer be stipulated only by The Law of IndividualIncome Tax, but fit to the collection and administration system of personal income tax. This isto some extent the homogenization of legal liability system between pesonal income tax andother taxes. The legal relief system of personal income tax also formed with the establishmentof the system of personal income tax. the administrative reconsideration system andadministrative litigation system of taxation had seted in three major personal taxes of1980s,and since carrying out the law of administrative reconsideration and administrative litigationthat unified in1990s, the legal relief system of personal income tax has losted individuation.Reforming the collection and administration system of personal income tax is the inexorabletrend of development of path. The core of reform is to reform the system of tax declaration,and the important step to reforme the system of tax declaration is creating system of fulldeclaration, the family plan impose, system of two-way declaration and incentive system ofdeclaration. Meanwhile the reform of the supporting collection and administration system ofpersonal income tax is also very important, and the important content of reform is establishingtax information sharing mechanism, property registration and reporting system and new cashmanagement mechanism; strengthen the real-name savings deposit system. The reform of legal liability and legal relief system is perfecting the construction of legal environment ofpersonal income tax. The reform trend of tax system is reforming the administrativereconsideration system of taxation, establishing and perfecting the system of tax revenue andjudicature insurance system, redistributing the burden of proof and refining the discretion.After studing the path of evolution of the legal system, the paper take overall outlookon the evolution path of the individual income tax. Paper demonstrate the current individualincome tax law draft amendment. As a results, the legislative draft also as a doctoraldissertation concludes. |
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