Chinese Individual Income Tax Profiting From Experience Of The USA

Since the implementation of the individual income tax in1980, China’s individualincome tax system has entered its thirty-third years. With the establishment of thesocialist market economy and the gradual improvement of China’s household incomelevel, individual income tax of our country has made great achievements. But in thecurrent economic situation, the individual income tax of our country still exist manyproblems. Such as unscientific system design of the individual income tax, unreasonablestructure of the tariff, unscientific method of the expense deduction method, levelbackward of the collection and management and so on. As one of the most developedcountries, the USA’s individual income tax development is also the most perfect in theworld. As the largest tax in the USA, the individual income tax makes a big differencein regulating individual income gap and stabilizing the economy. The reform of theindividual income tax in our country can learn from the USA’s development experience,further perfect the individual income tax, combining the actual situation of our country,and to solve the existing problems of China’s individual income tax.This article expounds the reference of individual income tax law of the USA toChina’s reform in three parts. The first chapter mainly expounds the function individualincome tax and tax unit. The second chapter tries to make comparison the system ofindividual income tax between two countries in four aspects: taxpayers, income andtaxable income, tax rate, tax collection and administration. Analyzing the system ofindividual income tax in two countries and put forward the existing problems ofindividual income tax in our country. The third chapter tries to improve the individualincome tax law in our country with USA’s development experience. Mainly expounds intwo aspects: the reconstruction of our country’s individual income tax system and theimprovement of collection and administration. Firstly, reforming the specific individual income tax from the angle of entity and suggesting our country adopt comprehensivetax system and optimize the tax structure, make the family as the tax unit, fully considerthe real tax capacity of taxpayer and improve tax deduction standard. Secondly,suggesting the propose from the angle of the revenue collection procedure, improveindividual income tax self-declaration system, construct the taxation informationmanagement system, construct the taxation system of rewards and punishment andencourage taxpayers pay tax positively.