A Study On Individual Income Tax Compliance

The individual income tax is an income tax directly imposed on the individual income,which is established for stabilizing the economy,narrowing the gap between the rich and poor and gathering the fiscal revenue.Most of the tax compliance theories were developed upon the A-S model,which is a model revealed the relationship among tax compliance,check frequency,punish power and tax rate using the mathematical methods.However,restricted by the hard assumptions,the results of this model are not so consist with the facts,and that induced the found of the prospect theory,which introduce the psychic factors into the economics.And the prospect theory applied in tax compliance expanded the fields of those influence factors towards taxpayers' decision.However,most of the west countries' tax system are integrated,while our nation is classified or even comprehensive and classified model,and so,doing research viewed from different income resources based on the A-S model and the prospect theory will make more sense.This paper will firstly estimate the scale of tax losing during 2002-2012 with the help of tax derive ability estimation,to prove that the ability of tax derive is infirm in China,containing serious tax risk.And then,on the point of the definition of tax compliance,“the law-based action of taxpayer that not contrary to the legislative intent and spirit”,describe the potential approach of tax losing among different income resources.Secondly,this paper will do a factorial analysis on the 2000-2012 tax fund structure,which will account for that there are different leading income items in different years,and focus on some items maybe in favor of the collection of the total individual income tax.And then,this paper will using the data gathered form the 2011 China Household Finance Survey(CHFS)make a Logit Model and a Ordinal Logistic Model analysis.Combined the two results,we confined that the salary income will generally influence the tax compliance,the greater income,the less possible to obey;the operation income may not influence the compliance of taxpayer;the asset income will remarkably affect the extent of tax compliance,still the more income,the poorer possibility to obey;and the gentle and education degree of taxpayer may have an impact on the submission of tax while the age and marriage of taxpayer will have no influence on it;and whether is a rural household will influence the risk of taxpayer whether to make a law-based action or not.And finally,this paper will focus on the proposal that carrying the comprehensive and classified individual income tax revolution step by step is the fundamental solution of tax compliance problem,offer several proposals incorporated with the early empirical study results,such as combined the labor income,recurring income and easily withholding at source income at first and later expand it;considering the income structure when determine the standard of self-declaration,and let taxpayer choose suitable tax subjects like the America tax system;taking the income and expenses condition into account in a humanistic expense deduction design;and fasten the instruction of supporting systems like a common natural taxpayer's registration number,non-cash payment and information sharing system.