Single Tax Theory, Practice And Reform Of China's Personal Income Tax

The paper was divided into 3 parts:Introduction, texts and conclusion. In the introduction, the author raised four points, and supposed that the Chinese government can use the flat tax theory to push the individual income tax reform. The texts included 6 chapters. Aiming at the lack of theoretical knowledge on the flat tax in the internal side, In Chapter 1 the author introduced the flat tax theory. Based on the review of the United States federal income tax system, the author analyzed the background, the specific design and economic impacts on economy of the flat tax theory, thus provided the basic theoretical basis for the following analysis. In Chapter 2 the author introduced the flat tax reforms of Jamaica and Russia and their successful experience. In Chapter 3 the author analyzed the impacts of the flat tax theory on the income tax reforms all over the world, and introduced the history and existing problems of the individual income tax system in the world, as well as the tax reforms in some countries in the direction of "to cut the tax rate, expand the tax base, and simplify the tax system", and deemed that Chinese tax system can also be reformed in this direction. In Chapter 4 the author introduced the history and present situation of the Chinese individual income tax, focusing on the main current problems, including the tax system itself, the tax administration system and the external environment. Then the author analyzed the new requirements on the individual income tax system which proposed by the domestic situation of income distribution. In Chapter 5 the author analyzed the aimed functions of the individual income tax in China as well as in other countries. Chapter 6 was the most important chapter in which the specific design of the Chinese individual income tax system was proposed with combination of Chinese situation, including tax collective pattern, expense deduction, tax rate, tax administration system, etc. The design of course wasn't the same as the "Robert E Hall & Alvin Rabushka tax system scheme", but based on China's actual conditions. In the conclusion, the author suggested that Chinese tax reform will be a step by step one, and the problem on how to use a flat tax theory to solve the fairness and efficiency in the tax reform still needs to be further explored.The author would like to explain that, the genuine spirit of the flat tax doesn't depend on the flat tax rate, but depend on the inherent uniform of equity and efficiency in the tax reform. In order to reach the goal, Chinese individual income tax reform should be conducted in the direction of "to cut the tax rate, expand the tax base, and simplify the tax system".In the conclusion, the author designed the new Chinese individual income tax scheme, using the empirical and standardized approach, studying the spirit of the flat tax theory and the successful flat tax reforms'experience in some countries and regions, and combining them with China's realities.