A Study On China's Individual Income Tax System

Nowadays, with the steady development of economy, people's income keeps increasing and individual income tax (IIT) goes up at a rapid speed, which has influenced our social life deeply. For twenty-five years, IIT plays an important role in collecting government revenue and adjusting income distribution. However, the disadvantages of IIT and its problems are also presented. The problem is caused by many factors, not only in history but also in economy and policy aspects. It makes the society appeal to IIT reform.This dissertation consists of five parts.The first part introduces the source and development of IIT, especially its forming, main features and developing history in China.The second part analyses IIT's effects on social equity, efficiency, labor supplying and economic stability, evaluates its effects to society and economy.The third part compares domestic and abroad IIT system in financial status, collection model and taxation elements. It points out the significant experience we can get from international IIT system.The fourth part analyses the existing problems of the IIT system. Taking Xiamen as an example to solve IIT problems in taxation model, ratio design, deduction standard and collection management.The fifth part is the author's suggestion on how to consummate the IIT system. The suggestion includes selecting the suitable taxation model, solving obvious income discrepancy, broadening collection range, establishing rational taxation structure, improving revenue policy and improving management system.