A Study On The Income Distribution Effect Of Enterprise Income Tax

Since the Reforming and Opening,with the continuing growth and the sustainable development of economy,the income gap has become bigger and bigger,social wealth is relatively concentrated in the hands of a few people,which will be a barrier to the social stability.In order to solve the problem,the government has taken some relative measures,to some extent,these measures relieved the income gap and were reaffirmed by people.But since the enterprise income tax is quite young in China and the taxation system still have some flaws and we Chinese hasn’t draw a high tax consciousness,people have doubt about whether the enterprise income tax help to solve the income inequality problem and if it does,how much it help to narrow the income gap.On the basis of comparing and reviewing the existing literature,this paper has analyzed the influence of the enterprise income tax on the income distribution gap from the angle of the theory,and then using the statistical yearbook data of income and using traditional tax incidence empirical analysis method,taking Chang Zhou for example to analyze the effects of enterprise income tax on the income distribution.Specifically,according to the assumption on the different tax burden of enterprise income tax,we will firstly give each family income tax allocation,then observe the relationship between effective tax rate and family income,and analyze the income distribution effects of enterprise income tax on the basis of calculating the MT index and K index.We have secondly analyzed about Chang Zhou regulation of personal income tax on the income distribution effects and then we have a comparison about the personal income tax redistribution effect and the regulating effect of enterprise income tax on income distribution gap.Lastly We give some conclusions as follows: Firstly,we take different assumptions on tax burden shifting and have a analysis that the enterprise income tax on the adjustment of the income distribution effects are different.On the whole,the average effective tax rate rise with the increase of income throughout the city,and that means enterprise income tax on the whole is progressive.In addition,when the consumers bore more enterprise income tax,the tax-progression index K and MT index of enterprise income tax will fall.Secondly,to compare the adjustment effect of income distribution gap of individual income tax and that of enterprise income tax in Chang Zhou,we found that the adjustment of the income tax for income gap is mainly through the enterprise income tax,the individual income tax plays a relatively small role.Therefore,our country should accelerate the reform and improvement of enterprise income tax,at the same time should be combined with other income distribution policy,in this way we will have a benefit to narrow the income gap,establish a harmonious and stable socialist society and realize the great "China dream".