The Design Of Tax System Mode Of Chinese Comprehensive And Classified Individual Income Tax

The individual income tax is an important means of government redistribution,playing a significant role in regulating the income gap of residents. However, ourexisting classified income taxation which applies different expense deductionstandards and tax rates on different incomes can not fully reflect the true taxablecapacity, even to cause unfair tax burden and weaken the regulating function. So, inthe face of the social reality of resident’s income gap widening, it is imperative toreform our individual income tax system mode to promote its adjusting function.Although comprehensive income taxation which can reflect taxpayer’s real taxcapacity in a greater extent is favorable to realizing tax fairness, we still do not havethe conditions of implementing it at present, due to its higher requirements on thelevel of tax collection and management. Therefore, implementing comprehensive andclassified individual income tax system by gradually introducing comprehensivefactors on the basis of classification is the realistic choice of our country.First of all, this paper analyzes the characteristics and disadvantages of existingclassified income taxation from the reality of our country. By comparing three kindsof tax system mode, combining with the specific conditions, we can conclude thatimplementing comprehensive and classified income tax system is the realistic choiceof reformation. Then, after analyzing and referring foreign experience, the paper putsforward reasonable suggestions for the reformation of individual income tax in China.Finally, focusing on the regulating function, the study carries out the design ofcomprehensive and classified individual income tax system through expanding taxbase, dividing comprehensive collection and classified collection scope reasonably,establishing rational expense deduction standard, optimizing tax rate, consummatingand building corresponding tax collection and management system to promote itssmooth implementation.