Concerning On Reform Personal Income Tax System

In 1980,China started to impose the personal income tax. By 1993,the total revenue of tax add up 23.7 billion yuan.After the reform of the personal income tax in 1993, the revenue of tax increased year by year,and it reached 318.5 billion yuan in 2007 which account for 6.44% of income tax.Personal income tax have changed from a small tax to be the fourth-largest tax which is next below value added tax, corporate income tax and sales tax.It has a extremely important influence for the increase of financial revenue and satisfying the government's funding needs for macro-control. The same time, personal income tax is a typical direct taxes, their scot is charged with the direct personal who obtain taxable income and it can not be impute to. Personal income tax have the most widely scope of taxation,and it is the most closely tax of the people's vital interests. So it has a positive theoretical and practical significance for in-depth studying of individual Income tax.Construction of our individual personal income tax system began in the early 80s.In 1993, personal income tax system reformed and personal income was divided into 11 categories which is respectively applicable to different provisions of fees deduction, different tax rates and different ways to count tax. It formed a set of income tax system lack a comprehensive classification. More than 10 years later, by China's continuous economic development, the shortcomings of individual income tax is also increasingly clear that aroused widespread concern in all sectors of society. How to reform the personal income tax model,personal and how to set up the exemption amount of income tax and so on are all the focus questions concerned by academic. Scholars have made a lot of research, and analyzed these issues from different points of view, then they provided a number of constructive proposals. Through the literature review, we find that more of the current studies are theoretical investigations. There are very few studies have combined income of specific statistics. Such as reform of the exemption amount of income tax, the recommendations of scholars are from the monthly income of 3000-8000 yuan, but these proposals are not based on the relevant statistical data and they are lack of any significant scientific nature.This paper start with the functional orientation of China's personal income tax, it introduce the model of personal income tax system first, and analyzed that today there are many drawbacks emerge in the classified income tax of our country. Although the comprehensive income tax system may well be an ideal revenue model China's current economic level as well as the Tax collection and management conditions have many restriction that determine the direction of the reform of China's personal income tax levied to transform from the classification system to imposing a system of mixed-mode. In the empirical research part of this paper, it is based on sample data of the income of urban and township residents in December 2008 at Sichuan Province, by comparing the different taxation model, to measure individual income tax to adjust income distribution and increasing financial income capacities by the Gini coefficient changes and changes in tax revenue for providing the future reform of personal income tax system with a scientific basis. And then this paper files some China's experience of proposed personal income tax reform by comparing these characteristics of a typical deduction of these countries'integrated project cost.