Research On The EET Regime Of Tax-deferred Commercial Pension Insurance In China

Since the income tax-deferred commercial pension insurance(ITDCPI)policy was put forward in 2008,Tianjin and Shanghai have tried to explore it,while there is none imposed up to now.However,because of the increasingly serious aging problem and the uneven development of the three pillar of pension,it's of great significance to carry out the tax-deferred commercial pension insurance in China.The paper introduced the present status of the tax-deferred commercial pension insurance in our country first,then compared regimes of Tianjin and Shanghai explored,and on this basis,this paper analyzed problems of carrying out the tax-deferred regime in China.Learning from the mature foreign experience,this paper selected the EET regime,which is the most suitable one for China.Then,this paper designed a preliminary scheme for the tax-deferred policy of China from several aspects,which are participants,the account-building,products selection,payment manners,drawing methods,and the exit mechanism.Then,this paper established a replacement rate model and tax expenditure model,taking Fujian province as an example,to calculate the effect of the tax-deferred scheme.Finally,this paper analyzed the sensitivity of main parameters of the model,the results showed that the EET regime can improve the replacement rate of some participants.The individual with higher revenue can achieve a high rate under the three payment manners---regular adjusting the maximum limit,the fixed 10 percent deduction and the'double limit'.While the replacement of man is higher than that of women,so it is necessary to improve the limit of women.Because of shorter contribution time,the middle-age workers benefit fewer even suffer loss.While from the aspect of the tax revenue loss of the government,the proportion deduction can cause huge pressure for the fiscal revenue,so making an absolute limit for the tax-deferred policy is necessary.However,an appropriately higher rate of return on investment can reduce the tax expenditure,which seems to be a feasible approach to solve the negative effects of the policy.