Research On The Effect Of Adjusting The Income Redistribution Of China's Individual Income Tax

In recent years, people's income levels continues to increase as China's economic development. Individual income tax, as the adjustment of income distribution of society and an important and positive lever of promoting stable economic growth, is listed as an important agenda to deepen fiscal and tax reform. The growing disparities of income remains the key issues of social concern of the past few years. And how the role of the individual income tax on income redistribution and its effect concern much attention.The main part of this paper include the theoretical analysis and empirical research combined approach, focusing primarily on empirical research. Based on the results of the theoretical analysis of the main effects of the individual income tax redistribution theory and related literature at home and abroad, the paper chooses measures of individual income tax redistributive effect. Based on the theoretical analysis, empirical analysis obtain the absolute value of the individual income tax redistribution effect and relative value index through measure and calculate the pre-tax, after-tax gini coefficient. Then the paper analyses the individual income tax adjustment income redistribution effect in China's urban residents from 1995 to 2011 quantitatively, and calculates the individual income tax share, the average tax rate of urban residents of different income levels. According to the different estimates, the paper obtains the influencing factors of individual income redistribution effect.Research shows that there are three reasons for China's personal income tax redistributive poor effect. First, the average personal income tax rate is too low, means that the tax base is narrow. Second, China's current personal income tax levy mode limits the redistribution of their individual income tax. Third, low tax collection levels on the individual income tax impedes the income redistribution function. Therefore the paper proposes to improve the personal income tax status, establish a comprehensive and classified personal income tax system and improve the level of tax collection to perfect redistribution of individual income tax reform direction adjustment function.