Study On The Pre-tax Deduction Standard System Of Wages And Salary In Individual Income Tax

Pre-tax deduction of individual income tax refers to a tax system that levies taxes on the balance after the pre-tax deduction of the cost and other necessary expenses. Some scholars think, in theory, we can determine what the basic content of deduction should contain through the study of Although our country has been perfecting personal income tax expense deduction, but has not keep up with the speed of rising prices. It not only can guarantee the citizen’s basic constitutional rights, but also conform to the requirements of China’s socialist fair distribution. In reality, with the rapid development of economy, the commodity prices rises a lot. At the same time, the social gap between the rich and the poor become bigger and bigger, especially the gap between the east and west region. Because of the increase in social contradictions, it urgent need for government regulation.Although our country has been perfecting pre-tax deduction of individual income tax, it has not keep up with the speed of rising prices. It does not consider the actual situation of different taxpayers, and it conflicts with the principle of tax fairness. This paper analyzes the defects of our current system of deduction. Compared with western countries’deduction system experience and combined with China’s national conditions at the same time, it puts forward relevant policy recommendations.This paper mainly divided into five parts, the first part is introduction, mainly introduced the current pre-tax deduction of income from wages and salaries background, significance and research status at home and abroad. The second part is the theory analysis of the individual pre-tax deduction of income from wages and salaries. The third part analyzes our country’s pre-tax deduction of income from wages and salaries. The fourth part introduces the developed countries the experience of the pre-tax deduction of income from wages and salaries, mainly introduces the individual income tax mode of American and Japanese. At the last part, it puts forward suggestions of perfecting our country’s pre-tax deduction of income from wages and salaries.