Policy Research Of High-Level Professionals’ Individual Income Tax In China

Gathering high-level professionals has an important significance on promoting industrial upgrading, developing strategic emerging industries, driving the knowledge-driven economic development and improving the quality of human resources. As the globalization of multinational production factors is deepening, high-level professionals has a strong mobility as capital does. A lot of empirical research and data analysis showed that individual income tax policy, in addition to political, environmental, cultural and other factors, has a significant impact on the flow of high-level professionals.This article uses literature research and theoretical analysis to assess how individual income tax influences the flow of high-level professionals. Collecting high tax from high-level professionals as ordinary high earners, did not realize the true sense of fairness. On the contrary, high tax caused the outflow of high-level professionals to the low tax countries, and reduced the social labor productivity and total social welfare.Comparing the individual income tax policies in some economic entities of different economic development levels such as United States, Britain, Germany, Singapore, South Korea and Hong Kong, we find the policy of ’wide tax base, low tax rates, tax-free allowances’played a positive role on gathering high-level professionals. At the same time, by analyzing the cases in Beijing Zhongguancun, Shanghai Pudong and Shenzhen Qianhai, we find there is great contradiction between our individual income tax policy and the gathering of high-level professionals.Based on the situation of our country, this article puts forward the solution of high-level professionals’individual income tax policy and four suggestions, namely reducing tax rate, perfecting the tax-free allowances, setting transitional policy and repaying individual income tax.