Experts say that the "starting point" of China's tax is not low and the space is limited.

Excessive attention to the threshold will mislead the tax reform "one tax threshold" is only one of many tax elements. Without the cooperation of other tax elements, it will be difficult to optimize the overall effect of the individual tax system, only one of many variables The “starting point” variable, a single dimension of excessive attention to raise the “starting point” of individual taxation, will mislead China’s personal income tax reform.
China urgently needs to carry out the reform of individual income tax combined with comprehensive classification and classification. According to the principle of broad tax base, strict collection and management, and the ability to pay taxes, the implementation of the "overall design, step-by-step implementation, creation conditions, and accelerated promotion" proposed by the central government is implemented. Personal income tax reform. A broad tax base means that all personal (family) income, including monetary and non-monetary income, should be included in the taxation as much as possible. The taxpayer may firstly transition from the individual as the reporting unit to the reporting mode in which the taxpayer chooses the individual or the family as the reporting unit. The tax rate of the comprehensive part is subject to an excessive progressive tax rate. The tax rate design principle is to simplify the collection and ensure the validity of the tax rate. From a short-term perspective, labor income should be merged as soon as possible, and the tax collection method should be unified. At the same time, actively create conditions to lay the foundation for deepening reform in the future.
Jia Kangliang Ji:
In recent years, China's personal income tax reform has become a hot topic of concern to all sectors of society. Especially during the annual two sessions of the National People's Republic of China, the proposal and call for raising the “starting point” of individual taxation has pushed the discussion of personal income tax to a climax. The whole people pay attention to individual taxes. On the one hand, it reflects that the concept of taxpayer awareness and democratic financial management of Chinese citizens is deeply rooted in the hearts of the people. On the other hand, it also shows that the community is often irrational, emotional and in discussing this highly professional fiscal and taxation issue. Non-specialized situation. The personal income tax system plays a role in regulating the income distribution gap in the taxation system of most countries, embodying the principle of tax fairness and quantity taxation, and the realization of these functions and principles must be guided by the basic theory of economics and finance. Undergraduately design its tax system. The “tax threshold” is only one of the many tax elements. Without the cooperation of other tax elements, it will be difficult to optimize the overall effect of the individual tax system. Only one of the “starting points” variables of many variables will be emphasized. Excessive attention to raising the "starting point" of individual tax will mislead China's personal income tax reform.
The current tax threshold for the current institutional framework is not low. China's tax "starting point", to increase the space limit of the tax "starting point" norm is "the salary income deduction standard", reflecting the basic needs of workers, to maintain the basic necessary expenditure for labor reproduction. The determination of the cost standard requires reference to the wage level of the employees in the country and the basic living expenses. In 2014, the average annual wage of employees in urban units across the country was 57,361 yuan, and the corresponding monthly average wage was 4,780 yuan. At present, the monthly deduction of 3,500 yuan of wage income is 73.2% of the average monthly wage. According to the comprehensive analysis, the current standard of wage and salary expenses in China accounts for more than 80% of the per capita wages of employees in the country, and the proportion of per capita wages in the highest areas of employees in 2014 exceeds 50%. China's current wage and salary standard household fee deduction standard exceeds the national urban standard household basic living expenses, and also exceeds the average level of the highest expenditure area. Based on this, it can be concluded that under the current tax system, the “starting point” of China’s individual tax is not low, and the space for improvement is limited.
After September 1, 2011, when the tax threshold is raised to 3,500 yuan, the number of taxpayers in China's working class who are subject to excessive progressive tax rate will be reduced to about 24 million. In recent years, with the salary level of workers. Increase, the coverage of excessive progressive tax rate adjustment should be expanded, but it is also tens of millions of people, accounting for only 3-4 percentage points of the total nationality. If the threshold is raised significantly, the tax will be more marginalized in China. It also clearly violated the requirements of the Fifth Plenary Session of the 18th Central Committee on gradually increasing the proportion of direct tax.
2. Increasing the “starting point” of individual tax, the higher payers benefit more, and the original intention of violating the individual tax is due to the application of the progressive tax rate for personal income tax, and the increase of the fee reduction standard, which may lower the highest tax rate for high-payers, thereby greatly reducing the Taxpayers’ tax credits lead to greater inequity.
3. Simply raising the “starting point” without simultaneously implementing the “income comprehensive, classified deduction” approach may be extremely unfair to different taxpayers. At the National Conference of the two countries, the Minister of Finance, Lou Jiwei, once again pointed out that it is unfair to simply raise the starting point. A person’s monthly salary of 5,000 yuan can be a good one, but if you have to raise a child to raise the elderly, it is very Contingency, so continuous improvement of the deduction standard under wages is not a direction. The central government's guidelines on individual tax reform have always been based on the combination of “integration and classification” in the previous documents. That is, the synthesizable parts of the 11 categories are first piled up, and the excessive progressive tax rate is imposed. This is the adjustment. The major premise that should be considered when collecting points. Moreover, it is reasonable to consider designing special deductions for household support burdens, housing mortgage interest burdens, etc.
4. China's personal income tax reform must address the issue of comprehensive treatment and overall planning. The current tax “starting point” does not have the necessary improvement and space. It does not mean that China's personal income tax does not need reform. On the contrary, China's taxation system is very imperfect, which has not only failed to play a role in regulating income distribution. It does not implement the fairness principle of taxation and the principle of quantitative taxation. It has brought unfairness and even led to “reverse”. adjust".
First of all, personal income is not included in the scope of personal income tax collection, and some high incomes other than those that need to increase the intensity of income redistribution adjustment are not adjusted or are too low. At present, China's personal income tax includes 11 categories of salary, remuneration, and operating income. With the economic and social development and the diversification of personal income sources, personal income income can be covered by the above 11 categories. For example, the factory-type rich, who do not wage wages for themselves or only symbolically open wages, can evade the adjustment mechanism of excess progressive tax rate for all or most of them. In the process of urbanization, a large number of urban residents receive a large amount of real estate and compensation income. From the perspective of compensating for their loss of land, the income of real estate is reasonable and legal, but since income (currency and non-monetary) is paid, personal income tax should be paid. In addition, according to the current policy, property owners have freely granted property rights to people with special relationships (including: (1) spouses, parents, children, grandparents, grandparents, grandchildren, grandchildren, brothers and sisters; (2 Providing a supporter or supporter who bears direct support or support obligations; (3) The legal heir, the will or the bequestee who obtained the property rights of the house in accordance with the law are exempt from personal income tax. Those who should also be treated differently, such as children who are underage or unable to work, are exempt from taxation to reflect family and human care, and for children who have grown up and have the ability to work, in the absence of the inheritance tax, The application of personal income tax clearly does not reflect the principle of “quantity of taxation” (the taxpayer has more taxation), and it is even more unfair: it is taxed by the income earned by hard work and wisdom, and the income from “getting nothing” is tax-free.
Second, similar income methods apply to different taxation methods and tax rates. The current personal income tax law divides labor income into three categories and applies different taxation methods. The three types of labor income include: salary income, labor income and remuneration. The income tax method is based on the progressive income tax rate based on the deduction of salary income. The labor income is based on the one-off deduction based on the applicable 20% rate. The remuneration is subject to a 20% proportional tax rate and is reduced by 30% on the taxable amount. In the past, when the salary income is the main body, the different policy differences and the difficulty of the collection and management are not obvious. With the diversification of employment system and employment relationship, the boundary between salary and labor is more blurred, trying to make a clear definition. It is also more difficult.
Third, different types of income apply different policies. A typical example is the transfer of property. In recent years, with the popularity of the second-hand housing market in the country, the personal income tax income of real estate sales has increased significantly. At present, it is necessary to pay personal income tax for individuals who sell non-unique housing in their homes. When calculating the original value, they can apply different accounting methods. The property that can find the original value is levied according to 20% of the difference in the real estate price (original value of the net). If the original value or the public house is not found, it is calculated according to 1% of the net price. For houses with the same market price in the same location, the personal income tax burden varies greatly depending on the state of the house. For example, if the net price is 4 million, the house will be subject to personal income tax for the non-single house under the name of the homeowner. If it is a public house, it will be subject to a tax of 40,000 yuan. If it is a commercial house, it is purchased earlier, and the corresponding original value is lower. If the original value is 1 million, a tax of 600,000 will be paid. If the purchase is later, the original value is higher, and if the original value is 3 million, a tax of 200,000 will be paid. A set of houses at the same market price can vary from 40,000 to 600,000, a difference of 15 times. Originally, the introduction of these policies, including the regulation and control target of suppressing real estate speculation (fast buying and selling), actually increased the tax burden of long-term residents, and in fact played the role of "reverse adjustment." It can also be seen from these that these policies have neglected the basic principle of the design of the personal income tax system (the principle of quantitative energy taxation). The tax burden is not related to the type of income, nor to the status of the income. The tax burden is even affected by some insignificant factors. The decision is very different.
The above only lists some of the negative effects brought about by the imperfect personal income tax system in China. The current personal income tax system in China is really time for comprehensive reform and improvement. However, the previous reforms since the establishment of the basic personal income tax framework in 1994, in addition to the interest income tax levy and suspension of the levy, other reforms are carried out around the "starting point" to improve, not in the "integrated" aspect. It seems that there is a concept in the society. There is only a problem in China’s taxation. The problem of China’s taxation can only be solved by raising the “starting point”, and people just forget that it was as early as sixteen in 2003. The objective of the personal income tax reform proposed by the Third Plenary Session is to establish a personal income tax system that combines “integration and classification”. This cannot be said, because excessive attention to the "starting point" of individual taxation has brought the attention of the people to the wrong direction, and the time and energy of the decision-making department have also been dissolved in the interpretation and design of the "starting point" policy. In fact, it is like a retreat.
China urgently needs to combine the individual income tax reform with the combination of classification and classification. The analysis of the characteristics and benefits of the individual income tax system combining synthesis and classification is very sufficient, and there is no need to repeat the discussion. To put it simply, the individual income tax system combined with classification and classification is based on the fact that the income type and nature of the income are not differentiated in general but the special income (such as capital gain) is treated differently, and the actual expenditure preference of the individual (family) is fully considered. In the case of a different level of expenditure, the tax system is scientifically designed in accordance with the principle of ability to pay. The advantage is that it maximizes the fair quantity and taxability principle and is easy to collect (no need to distinguish the type of income). However, its management requirements are obviously higher than the classification. It is necessary to emphasize that the promotion of personal income tax reform is of strategic significance for the establishment of China's modern fiscal and taxation system and even the modernization of state governance, and for the ongoing supply-side structure. Reform is crucial.
1. Personal income tax reform can promote the decisive role of the market in resource allocation and better play the role of government. Under the market economy system, the market plays a decisive role in allocating resources in the initial distribution (production chain) to stimulate market vitality and improve production efficiency. Strive to maximize the economic "cake"; the government in the redistribution link (tax and social security links) to optimize the role of income distribution, promote social equity and maintain social stability. Through the rational and organic cooperation between the two, the sound development of the economy and society will be realized. The taxation theory formed under this framework requires the design of a country's taxation system (system) to minimize the impact on the allocation of resources in the production chain. The initial distribution should keep the tax “neutral” as much as possible, and the redistribution link should pay attention to the rationality. Don't treat “sweetening and thinning” in the region to suppress polarization. Taxation is the “wedge” of entering the market economy. While raising the necessary capital income for the government to perform its duties, it will inevitably have an impact on resource allocation and income distribution. To this end, based on the actual situation of the country (such as the capacity of the collection and management), the use of tax mix (direct tax and indirect tax mix) and tax substitution (with VAT instead of traditional business tax), etc., strive to fully play the various tax functions.
In general, indirect taxes are mostly collected in the production and sales of goods and services, and are closely related to prices. In the national economic accounting system, they participate in the initial allocation; while direct taxes (such as personal income tax) participate in the redistribution. This means that it is necessary to optimize the design with an indirect tax system (such as the reform of the camp), improve the initial allocation, and give full play to the decisive role of the market in resource allocation. In the current situation of China's indirect tax ratio is much higher than the direct tax ratio and for a long time in the future, it is necessary to attach great importance to reform and improve the personal income tax system, and through the broad tax base and strict collection and management, actively play the role of redistribution when collecting personal income tax. The growth of its income scale has led to the gradual increase of the proportion of direct tax in China, reducing the proportion of indirect taxes, thereby reducing the interference of China's tax system on production, promoting the decisive role of the market in resource allocation, and at the same time with more direct tax adjustment. Income distribution, reduce income distribution gaps, promote social harmony, and help common prosperity. This is the proper meaning of the problem of better playing the role of the government. The improvement of the personal income tax system itself is an important part of the supply of the government system. The personal income tax participates in the redistribution accounting, which provides a powerful institutional control tool for the government to play a role in the redistribution process.
Appropriate reduction of the income distribution gap is inevitable. Both theory and practice demonstrate the importance of the government's unshirkable responsibility in solving the problem of income distribution. Although personal income tax is not the only means, it is an indispensable means.
2. The personal income tax reform has important strategic significance for China's construction of modern fiscal and taxation system and even the modernization of state governance. The fiscal and taxation system includes the taxation and non-tax revenues that solve the problem of “where the money comes from” and the expenditure of “where the money is used”. The standardization carrier of transfer payment and capital expenditure and expenditure, that is, the budgetary regulations of a series of systems, systems and mechanisms, the substantive problem dealt with is to deal with the three basic relationships in economic and social life: between the government and the market entity The distribution of financial resources, resources, and interests between the central government and local governments, and between the public rights system and citizens. The reason why the finance has become the basis of state governance, the reason why the budget reflects the scope, direction and key points of the political activities, the reason why the fiscal and taxation distribution is closely related to the national economy and the people's livelihood, and the financial history reflects the stage and structural evolution of social evolution. It also reflects the development of social justice and the level of civilization. The reason why the fiscal reform should provide comprehensive support for the comprehensive reform "both the beginning and the back of the temple" is because the government and thousands of enterprises, the central government and local governments, and the public rights. The power, responsibility, and profit relationship between the system and citizens or taxpayers must be reflected in the fiscal system. Correspondingly, the significance of the fiscal and taxation system in state governance is self-evident.
The modern fiscal and taxation system is based on the relationship between the government and the market. Based on the distribution mechanism, the "three in one" handles the three basic economic relations between the government and enterprises, the central and local governments, and public rights and citizens. The modern fiscal and taxation system is characterized by a perfect personal income tax system and ample income from personal income tax. In addition to the role of the “automatic stabilizer” in the operation of the national economy, compared with other taxes, personal income tax can better reflect the unification of taxpayers and taxpayers, greatly reduce the transfer mechanism of tax burden, and reduce the non-transfer of tax burden. Certainty, which makes the fiscal relationship between public power and citizens more direct, is crucial for the current advancement of China's modernization process. Through reform and improvement of the personal income tax system, more nationals in income growth will become taxpayers, so that they fully understand their responsibilities and rights as taxpayers, strengthen their awareness of supervising the government's democratic financial management, and accelerate the government's democratic financial management. It is both necessary and necessary to govern the wealth of the law and even the process of democratization in our country.
Judging from the countries at the forefront of the modernization process, most of their tax systems have long been characterized by “individual” (or family) as the main body of tax payment, and the mechanism of “tax-transfer” has been eliminated to the utmost extent, while China is a typical “enterprise”. As the taxpayer, whether it is a “large” tax such as value-added tax (business tax), consumption tax, and corporate income tax, or a “small” tax such as property tax, urban construction tax, or even farmland occupation tax, the enterprise is a taxpayer. In the ultimate sense, the turnover tax (indirect tax) tax burden is ultimately mainly borne by the “individual” (individual or family), but in the long transfer chain, the “enterprise” is forced to bear the temporary for a certain period of time. The tax burden that has not been passed on has formed a de facto big impact on resource allocation, which has interfered with the decisive role of market allocation resources, and has also led to another hot topic in recent years, that is, the macro tax burden is not high. The microeconomic entity has a high tax burden. Regardless of horizontal comparison or vertical comparison, whether it is international comparison or the rigid demand of China's fiscal expenditure, China's macro tax burden level is indeed not high, but the market micro-subject and the low-income class of the consumer mass feel the tax burden. The level of pain is quite high. The research shows that China promotes the construction of modern fiscal and taxation system and realizes the modernization of state governance. Individual income tax reform is one of the key options at the strategic level, so it is a must-have task to include the financial supporting reform program. Through the reform of personal income tax, increasing the proportion of direct tax and then reducing the proportion of indirect tax system, it has a significant weight in establishing a modern tax system with income tax and turnover tax dual-subject tax structure and “individual” as taxpayer.
3. The personal income tax reform plays an important role in the implementation of supply-side structural reforms and the improvement of economic vitality. As mentioned above, the characteristics of China's indirect taxes are: (1) mainly for enterprises; (2) for turnover; (3) ) Proportional tax rate. This means that regardless of the size, regardless of profitability, there is a tax on “opening the door”, and under the “pipe-to-tax” collection and management system, there is almost no space and possibility of tax avoidance. According to a survey, at least 62% of the taxes paid by individual industrial and commercial households are turnover taxes. Under this circumstance, China's tax system has a strong "regressive" characteristics. The traditional “regressive” theory of taxation refers to the regressive income distribution due to the proportional tax rate, that is, the tax burden cannot increase with the increase of income. The regressiveness mentioned here refers to the regressiveness of business operations. This kind of indirect tax-based tax structure is regressive to the production and operation of enterprises. For many small and medium-sized enterprises with weak profitability, they can enjoy the simple form of operation, simple form of equity, and weak negotiation ability with the government. The tax incentives and financial subsidies are very limited, but they bear the same turnover tax burden as the Zhongda enterprises. The high degree of tax pain is self-evident.
In the implementation of the “supply-side structural reform” that has been clearly stated, the above-mentioned problem is solved by reforming the individual income tax. By broadening the tax base and implementing the principle of “payment ability”, it is strictly regulated to provide personal income tax. Total income, which in turn reduces the proportion of indirect taxes. Under this circumstance, the nominal tax rate of enterprise turnover tax is reduced, and the taxation cost of employing labor is not necessarily increased. This is because the increase of personal income tax is mainly achieved by broadening the tax base and increasing the tax burden of high-income earners. Judging from the current pattern of personal income, the proportion of tax revenue contribution of high-income earners is not high. This space for optimizing tax structure and enhancing the vitality of economic development needs to be opened.
The idea and policy points of personal income tax reform have established the goal of combining the individual income tax system with comprehensive classification and classification. It is clear that under the goal, according to the principle of broad tax base, strict collection and management, and the ability to pay taxes, the central government proposes “total design”. The implementation of the personal income tax reform is carried out in the way of implementing the steps step by step, creating conditions and accelerating progress.
A broad tax base means that all personal (family) income, including monetary and non-monetary income, should be included in the taxation as much as possible. For taxpayers, all members of society except low-income people should be covered as much as possible. For example, when considering the scope of taxpayers, the income of urban residents of the National Bureau of Statistics can be used as a reference. The National Bureau of Statistics divides China's urban residents from low to high according to disposable income into five groups. According to the disposable income of each group of income households, the basic relief amount can be delineated. In principle, only low-income people can go online or Social members below the lower line of middle-lower income earners are exempt from personal income tax, while Others are taxed to ensure the realization of the broad tax base principle.
Yan Zheng Guan is the tax collection and collection of income, which is a long-term mechanism to protect honest people, restrict tax evasion, combat tax evasion and cultivate a credible tax culture. The principle of embodying the ability to pay taxes is to consider designing the tax system based on actual ability to pay, which is determined by two factors: income and expenditure. From the income side, except for a very small form of income (such as capital gains, etc.), regardless of the form and nature of income, it should be included in the comprehensive tax base and unified taxation method; from the expenditure side, full consideration should be given. The difference between the actual expenditure form and structure of each individual (individual or family) adopts a differential wide exemption system, that is, the 1+X exemption system, and 1 refers to a unified deduction standard, which can be accompanied by CPI. Index changes are adjusted periodically (for example, three years). X refers to the part of the waiver that is differentiated and routinely adjusted according to the individual taxpayer's expenditure structure. Factors that may be considered for inclusion in dynamic routine adjustments include: personal family support, major medical expenditures, consumer and housing credit interest payments, education expenditures, and individual career development training expenditures.
The taxpayer may first transition from the individual as the reporting unit to the reporting mode in which the taxpayer chooses the individual or the family as the reporting unit. China's family concept is relatively broad, and it is difficult to form a technically operable family unit definition at present. Therefore, in the initial stage of reform, individuals can be used as the reporting unit. However, if the family is the reporting unit, it can better reflect the principle of quantity and taxability, so it should become the direction of future reform. The reason for finally returning the choice of the declaration model to the taxpayer is to avoid some phenomena that are not conducive to social stability due to the tax (such as the phenomenon of “fake divorce” that is currently occurring to avoid taxation of real estate transactions).
The tax rate of the comprehensive part is subject to an excessive progressive tax rate. The tax rate design principle is to simplify the collection and ensure the validity of the tax rate. At the same time, to ensure that low-income people pay taxes but the tax burden is very light, to meet the requirements of not only paying taxpayers' tax awareness, but also to impose a heavier burden on them; middle-income earners are less tax-intensive, and try not to hurt the work and consumption enthusiasm of middle-income earners. It is conducive to the cultivation of the middle-income class and the formation of the middle class; the highest marginal tax rate faced by high-income people is the highest (45%) than the 7-level excess progressive tax rate of the current salary. It can also be designed as Reduced, but considering the actual life, the proportion of the extra-income income of the high-income class is significantly higher than that of the middle- and low-income groups. However, these incomes are not adjusted to “excessive progress” and are easy to adjust. Evading taxes, but under the “comprehensive” part of the new personal income tax, these incomes will be included in the higher marginal tax rate, and the result of the implementation must be the actual tax burden of these people. This can better reflect the principle of paying taxes and paying more taxes. It will also greatly eliminate the existing "reverse adjustment" factors, strengthen the redistribution of income gaps, and enhance the ability of individual income tax to raise income.
On the specific collection and management, we can consider the unit of tax payment time, the combination of source deduction and self-declaration, and settlement at the end of the year. The income from wages and salaries, labor remuneration, remuneration, interest, dividends, dividends, etc. shall be withheld by the source, and other income shall be declared by the taxpayer. Before the end of the first quarter of the following year, all taxpayers declare themselves and make up taxes or refunds according to the paid and payable conditions. The source deduction is designed to prevent the loss of tax revenue while ensuring that taxes are evenly deposited. Self-declaration aims to cultivate taxpayers' tax awareness and assist sources to deduct taxes and reduce tax losses.
From a short-term perspective, labor income should be merged as soon as possible, and the tax collection method should be unified. At the same time, actively create conditions to lay the foundation for deepening reform in the future. The precondition for the smooth implementation of personal income tax combined with classification is the reduction of cash amount and the completeness and sharing of taxpayer income and expenditure information. From the current reality, the conditions for reducing cash use are already in place, and the system and technology are supported. Bank cards and POS machines are widely used, and the use of personal checks can be promoted in the future. After years of development, the income and expenditure and credit information of family or individual in China have been relatively complete. The informationization of Chinese government departments has the advantage of latecomer and is at the forefront of the world. What needs to be done now is to break the limits of interests and realize information. Conditional sharing and use. Therefore, it is recommended that the State Council take the lead and establish a database system including basic personal information and financial and credit information based on the data information of relevant functional departments to create technical conditions for personal income tax reform. The construction of this system is not only of great significance in the reform of individual tax, but also of great significance to the construction of credit society in China and the regulation of individual behavior.
(Jia Kang is the former director of the Institute of Fiscal Science of the Ministry of Finance and the dean of the Huaxia New Supply Economics Research Institute; Liang Ji is a researcher at the Institute of Fiscal Science of the Ministry of Finance)