Research On Expense Deduction Standard Of The Income Tax In China

With the process of reform and opening up and the transformation of the market economy,China's economy has developed at a rapid pace.At the same time,due to the raised living standard,people's living costs have increased.The ensuing issues of education,housing,and medical care have become major issues of concern to the people.The problem that the growth of per capital disposable income does not match the speed of macroeconomic development and the gap between the rich and the poor has become a problem that cannot be ignored in the path of economic development.According to the Regulations of the People's Republic of China No.707 “Implementation Regulations of the Individual Income Tax Law of the People's Republic of China”,the personal income tax system combined with classification and comprehensive deduction shall be implemented from January 1,2019.According to the future development of personal income tax in China,it has become an inevitable way to change the taxation model into a combination of classification and integration.Among them,cost deduction is an important part of tax fairness.It has important practical significance to effectively adjust the income distribution of individual income tax.The new personal income tax system has changed a lot from the previous ones,but the basic livelihood fee deduction has not yet established a dynamic adjustment mechanism,and the special deduction method is simplistic,and there is room for further improvement.Considering the compensation for maintenance expenses,special education expenses,medical expenses for major illnesses,housing rents,and interest on housing loans,it is conducive to better reflecting the true living standards of taxpayers,and is conducive to overcoming the problem of simplification of cost deduction standards.The embodiment of the fairness of personal income tax.The setting of the special cost deduction can better measure the taxpayer's true tax burden and help to reduce the tax burden for taxpayers.Based on this,in order to gradually improve the personal income tax deduction system,this paper bases on the theoretical basis of personal income tax deduction,and draws on the foreign individual income tax deduction system under the premise of analyzing the expenditures of various expenses,and designs a set of plans.Specifically,the paper is divided into six parts:The first part is an introduction.This chapter mainly expounds the research background and significance of this paper.It briefly summarizes and comments on the theoretical basis,index adjustment and scope of relevant fees deduction.Finally,the research content and research methods of this paper are expounded..The second part is the theoretical basis of personal income tax deduction.This chapter describes the types and methods of personal income tax deduction,and analyzes the principle of personal income tax deduction for social equity,which lays a theoretical foundation for the mathematical analysis.The third part is the introduction to the status quo.This chapter mainly describes the historical evolution of China's personal income tax regulations and expounds the problems existing in the current personal income tax deduction standard setting.The fourth part is an analysis of the cost deduction.This chapter mainly measures the basic livelihood cost standard of individual income tax and how each special deduction standard should be set by describing the expenditure profile of each expense.At the same time,according to the measured standards,the total cost deduction amount and the total cost deduction amount will be calculated to affect the personal income tax income.The fifth part is the setting of foreign personal income tax deduction standard.This chapter mainly describes how the cost deduction standard is set in some foreign countries,and combines the current personal income tax deduction standard setting in China to illustrate some foreign fee deduction standard setting experience that we can learn from.The sixth part is the countermeasures and suggestions to improve the personal income tax deduction standard.This chapter is mainly based on the summarization of foreign experience,and at the same time combined with the problems of China's cost deduction standard,it puts forward suggestions on the future cost deduction standard setting.