The Research On Fiscal Policy To Narrow The Income Gap Of Resident In China

The reality of economic and social development in different periods demandsdifferent requirements. Since the Reform and Opening Up, China breaks the practiceof egalitarianism. The principle of” Giving priority to efficiency, giving considerationto fairness” set the basic direction of our country for the income distribution reform.Now, China’s economic has take-off rapidly. In fact, we have achieved a historic leapfrom inadequately fed and clad to the overall well-off. However, the income gap isbeing further expanded. Not only the expanding income gap will increase the socialcontradictions between the members of society, destruction of a harmonious andstable social environment, but also affect the enthusiasm of the people’s labor,resulting in the decline of the entire socio-economic efficiency. In future, policiesshould focus on principle of “initial distribution focus on efficiency, re-distributionfocus on equity “. Its basic value orientation is constantly strengthening the focus ofsocial justice issues in the dynamic process of economic and social development. Weshould pursuit social justice, and win the best outcome of the game in the progressiverealization of economic efficiency and social equity in reform and development. Infuture, rectifying and standardizing order of distribution will become the importanttask.Government should focus on addressing the income gap.This paper launches an in-depth study on the growing problem of income gapof residents in China from five parts. Chapter I is an introduction on the researchbackground, significance of the topic, to review related articles, the research methods,the frame, innovation and the inadequacies. Chapter II describes the theoretical basisfor narrowing the income gap, including definition of income gap of resident andjustice, the tax theory and the theory of transfer payments. In chapter III, four aspectsincluding the expansion of the income gap between urban residents, the expansion ofthe income gap between urban and rural residents, the expansion of the income gapbetween residents of inter-regional disparities and the expansion of the income gapbetween industries all prove China’s income gap.At the same time, analysis of thewidening income gap of the residents in China is also be showed. The fourth chapterintroduces the foreign experience in narrowing the income gap, including both theexperience of developed countries and the experience of developing countries. Thefifth chapter proposes that the two aspects-tax and expenditure policies help narrowthe income gap in China.