Analysis Of Effect Brought By Special Additional Deduction Of Individual Income Tax

As a direct tax,personal income tax plays a role in regulating income distribution and promoting social equity.With the rapid development of China's economy,the gap between the rich and the poor has gradually widened,and the disadvantages of the old tax model have gradually emerged.For this reason,in 2019,the state carried out a new round of individual income tax reform,comprehensively considered the household burden of residents,and added six special additional deductions closely related to people's life in the personal income tax,so that the working class could benefit widely.The specific effect of the new individual income tax policy has not been known.Based on this,this paper takes the working class whose taxable income reaches the threshold as the object of investigation,collects data by questionnaire,and explores the welfare effect brought by the implementation of this policy for the working class in Nanchang.Combined with the existing research,this paper deeply explores the income redistribution effect,consumption effect and the impact on the quality of life and life satisfaction of the working class in Nanchang city through correspondence analysis,cross analysis,multiple regression and tendency score matching method in econometrics.The results are as follows: first,in terms of the reduction of tax burden,the special additional deduction policy of personal income tax has halved the tax burden of most taxpayers in Nanchang City,and the low-income group and the middle-income group are expected to clear the tax burden.In terms of the relative tax burden rate,the reduction degree of the high-income group is far greater than that of the low-income group,and the special deduction has weakened the tax progressiveness of personal income tax to a certain extent Redistribution effect weakened.Second,the special additional deduction of individual income tax has changed the share of residents' income under the original taxation mode.Among them,the share of income of low-income and middle and low-income groups still increases after tax,but the increase shows a decreasing trend with the increase of the special additional deduction amount.The share of income of middle and high-income groups after tax increases with the increase of the deduction amount,and is deducted every month Except for the first increase when the amount is 2500 yuan,it has beengrowing steadily since then.Although the share of income of high-income groups after tax payment is still decreasing,the decrease is decreasing with the increase of the deduction amount,which again shows that the special additional deduction of personal income tax weakens the income redistribution effect of personal income tax.Third,the special additional deduction can significantly stimulate the consumption of Nanchang residents,and the influence degree is slightly different due to the different income level and special additional deduction items.On the whole,it can increase the average monthly consumption amount of taxpayers by about 132 yuan.There is no significant increase in the consumption amount of low-income groups.The average monthly consumption increase of middle-income groups is about 161 yuan,and the average monthly consumption increase of high-income and above groups is about 243 yuan.Only three special additional deductions for children's education,supporting the elderly and housing rent can significantly improve the consumption level of working class in Nanchang City,among which the special deduction for supporting the elderly can increase the average monthly consumption of taxpayers by 93 yuan,the special deduction for housing loans can increase the average monthly consumption of taxpayers by 52 yuan,and the consumption effect of the special additional deduction for children's education is about the special deduction for supporting the elderly About half of the deduction.However,the special additional deduction of housing rent has no significant impact,which may be due to the fact that the respondents are worried that the special additional deduction of housing rent declaration will cause the house rent to rise and not declare.Fourth,the respondents subjectively think that the special additional deduction of housing loan can relieve the pressure of house purchase to a certain extent and improve the quality of life.The vast majority of people think that this policy has no significant impact on their medical burden and continuing education.Fifth,only the middle and high-income groups think that the policy slightly improves the fairness of the tax collection method,and the taxpayers with middle and lower incomes think that there is no obvious change,and the residents' overall sense of gain is not high.Sixth,the reduction of tax burden,children's education and special additional deduction of continuing education can significantly improve the life satisfaction of working class in Nanchang City,inwhich the intuitive reduction of tax burden can improve the residents' life satisfaction more than the percentage of tax burden reduction,and the subjective well-being of children's education deduction is far greater than that of continuing education deduction.Finally,according to the analysis results,this paper puts forward some suggestions from the two aspects of government and individual,in order to better improve the special additional deduction policy of personal income tax and give full play to the tax leverage of personal income tax.