| The introduction of the new Individual Income Tax Law in 2019 is an extremely important reform in the history of individual income tax in China.Its substantial tax reduction effect is widely beneficial to the middle and low income earners,especially to stimulate the improvement of the consumption power of middle-income earners.The report of the 19 th National Congress of the Communist Party of China clearly proposes to raise the proportion of middle-income earners,which will be a clear sign of China’s sustainable development.The individual income tax reduction will help raise the disposable income of middle-income earners,narrow the income gap between high and low earners,and address the problem of unbalanced and inadequate development.Based on this,it is of great academic and practical significance to deeply study the influence of the individual income tax reduction on the consumption ability of middle-income earners.Starting from the research purpose,the thesis firstly defines the range of middle-income earners,that is,the group with annual disposable income of 240,000-600,000 yuan or per capita income of 120,000-300,000 yuan,and states the goal of individual income tax reduction.Secondly,by analyzing the path of tax reduction policy of the new individual income tax reduction,it points out the important role of individual income tax in adjusting residents’ income distribution and narrowing the income distribution gap,in addition,clarifing the effect and impact of this tax cut.Thirdly,discussing the influence mechanism of the individual income tax reduction on the consumption demand of middle-income earners,and demonstrating the effect of the new tax system on the reduction of personal tax burden and increase of disposable income.Stimulated by the growth of disposable income,the individual income tax reduction will increase the proportion of household consumption expenditure and affect the consumption demand of middle-income people.Finally,proposing a strategy to stimulate the influence of the new tax system on the consumption demand of middle-income earners.The first is continue to improve the way individual income tax,including improving the standard for deducting expenses,broadening the scope of the tax base and reducing the tax rate series.The second is to further promote the innovation of the tax system model and promote the individual taxation model of "Big integration,Small classification",including the path,goals and steps.The third is to improve the personal income tax collection and management system,give full play to the role of individual income tax in regulating consumption and establish a modern tax civilization. |
