A Research Report On The Degree Of Compliance Of Individual Income Tax And Its Influence Factors In China

Tax is the main source of government receipts. The government use it to reduce the gap between the rich and the poor, especially the personal income tax which adjusted by its progressive effect. The loss of tax revenue comes with the taxation and it has become a difficult problem for governments all over the world. The loss of personal income tax in our country is very serious. It is estimated that every year there is a huge amount of tax loss and the number is rising. In 2014, the number reached to 10497.14 billion, which is 8.81% of the total tax revenue.The tax compliance affects the severity of tax loss. The research on tax compliance in China is usually an introduction to the theory of tax compliance or a reference to the relevant theory of tax compliance. Few scholars have carried out relevant research from the practice.This paper do some research about the situation of China’s personal income tax compliance, finding factors which impact it most using the methods of literature study, theoretical analysis, survey analysis and so on. Then put forward relevant suggestions for improvement.Consulting some literatures, I primarily find out that individual characteristics(such as age, gender), social tax environment(such as tax compliance costs, social justice), taxation factors, tax factors will have an impact on the personal income tax compliance. Theoretical analysis explains why those factors impact the personal income tax compliance. According to the conclusions of theoretical analysis, the characteristics of personal income tax and the actual situation of our country, I make a survey on the field.The result shows that tax services, tax collection and management level, tax fairness, tax revenue, tax compliance costs, tax incentives, tax system rationality make China a low personal income tax compliance. Improving the tax service level and effect, enhancing the taxpayer’s tax consciousness, strengthening the collection and administration of individual income tax, improving the individual income tax system, establishing a fair and equitable tax environment is beneficial to improving the compliance of our individual income tax.