Research On Tax Policy Of Improving Residents’ Consumption Level

Consumption, investment and net export are the main ultimate impetus of economic development. However,consumption is the ultimate impetus. Consumption and taxation are important to our economic and society, which can help them develop healthily. When economic development model needs to transfer from investment-driven growth to consumption-driven growth, residents’ consumption level should be raised up. But the slow growth in residents’ consumption goes against transformation of economic development mode when China is in a crucial time for that.Adjusting the taxation policy can release spending power. And the emphasis are reducing the indirect tax, improving the consumption tax items and optimizing the direct tax system. Reform of individual income tax and property tax, and collecting social security tax are included. These measures will contribute to not only moderate consumer expectation and propensity but diminish worries behind, so that the most out of consumption capacity can be released.The empirical results show that existing indirect taxes on the level of consumption was significantly inhibited. Reduce the indirect tax structure in the proportion, reducing VAT, business tax, consumption tax and other tax burden onto consumers easy tax burden, can reduce the price of goods and services, reduce consumer costs residents, which can effectively promote the level of consumption improved. By the analysis of related to the patterns of the classification of the personal income tax collection of our country, also did not give full play to the effect of adjusting income distribution. China’s current property tax levy has a negative effect on household consumption. Setting taxes rather than making major corporate taxpayer is resident tax, which does not play a direct role in promoting consumer tax levels. Property stocks equivalent to another form of savings, their taxation will have a strong ―substitution effect‖ between savings and consumption, the need to improve our property tax system, play a role in the regulation of property tax revenue.