The young people asked
how to levy the "14th Five-Year Plan" tax
on the people's livelihood, so as to hold the big car of fair income distribution
With the advent of the gig economy era, it is becoming more and more difficult to distinguish between income from production and operation and income from labor, which raises new issues for tax adjustments.
At the same time, there has been a long-standing call for lowering the maximum marginal tax rate of 45%. How to balance talent retention and fairness?
In the next five years, let's look at how the tax reform will break through the barriers!
---------------
Every small change in the trillion-dollar tax will affect the nerves of the public, and personal income tax has received the most attention.
So far, China has carried out seven rounds of tax reforms.
In 2018, marked by the revision of the new tax law, the seventh round of tax reforms in the history of my country kicked off. This is also the most powerful of the previous tax reforms-the tax exemption was increased to only 5,000 yuan It is a "small gift package". Whether it is the first introduction of a comprehensive tax calculation model or the addition of six special additional deductions, the impact on personal wallets is much more important than increasing the exemption.
Judging from the current situation, this round of reforms has achieved remarkable results, and taxpayers’ satisfaction is quite high.
In two years, this reform has allowed 250 million people to enjoy tax cut dividends. The estimated tax cuts exceed 500 billion yuan.
At the end of the 13th Five-Year Plan and the beginning of the 14th Five-Year Plan, what everyone wants to know is how this reform will continue and deepen.
As a direct tax, individual tax is an important tool for adjusting income distribution.
Regarding the adjustment of personal income, the "Proposal of the Central Committee of the Communist Party of China on Formulating the Fourteenth Five-Year Plan for National Economic and Social Development and the Long-Term Goals for 2035" (hereinafter referred to as the "Proposal") pointed out that the redistribution mechanism should be improved. Increase the intensity and accuracy of taxation, social security, transfer payments, etc., rationally adjust excessively high income, and ban illegal income.
The Minister of Finance Liu Kun recently wrote an article that during the "14th Five-Year Plan" period, the personal income tax system that combines comprehensive and classified personal income tax will be further improved.
Promote the reform and amendment of personal income tax in a timely manner, reasonably expand the scope of income included in the syndrome tax, improve special additional deduction items, and improve the policy system for attracting high-end overseas talents.
Professor Li Xuhong, director and professor of the Institute of Fiscal and Tax Policy and Application of Beijing National Accounting Institute, compared the "Proposal" and Liu Kun's article on personal tax. She believes that during the "14th Five-Year Plan" period, personal tax reform will serve the overall tax system structure. Adjust to promote the further improvement and development of a scientific and fair modern taxation system.
"The focus is no longer on large-scale tax cuts, but on making the tax system fairer."
Operating income or first to be included in comprehensive income
In the seventh round of tax reform, “fairness” is the first priority, which can be seen from the introduction of a comprehensive tax calculation model for the first time in the tax reform.
Before 2019, my country's personal tax was levied by classification, that is, different types of income have different applicable tax rates and deduction standards. This makes different types of income have different tax burdens, which is contrary to the principle of fairness.
Therefore, there are very few countries that adopt a single taxation taxation model in the world.
In order to change this situation, the finance and taxation department has reshaped the tax system. The previous wages and salaries, labor remuneration, royalties, and author's remuneration have been unified into comprehensive income, and a unified excess progressive tax rate has been adopted to ensure that the four income items are subject to the same tax rate. , Rather than the previous different tax rates, which reflects fairness.
Li Xuhong spoke highly of this. She said that this model takes the comprehensive taxpayer's burden into consideration, promotes the balance of individual tax burdens among different types of income, and effectively reduces the taxpayer's comprehensive tax burden. It is a first step in the principle of tax fairness. Effective practice.
Since comprehensive taxation has higher requirements for collection and management capabilities and tax compliance, at the initial stage, the reform only included four incomes such as wages and salaries that are easy to collect and manage, difficult to pass on, or tax avoidance into the comprehensive income range. , Income from interest, dividends, bonuses, income from property leases, income from property transfers, incidental income, etc., are still taxed by classification and individual income taxes are calculated separately in accordance with regulations.
As a result, my country has initially established a comprehensive and classified personal tax system.
This is for a smooth transition of reforms.
Li Hua, director of the Department of Finance of Shandong University and director of the China Taxation Society, said that considering fairness, comprehensive income must continue to be expanded, but this is a gradual process.
"This kind of'small integration' is actually a trade-off between tax collection and administration and tax system fairness."
The statement of “reasonably expand the scope of income included in the syndrome tax” in Liu Kun’s article means that this reform will continue to be improved during the “14th Five-Year Plan” period, and operating income is considered to be the first to be included in the comprehensive income calculation. Tax.
"The four items of wages, salaries, labor remuneration, etc. are unified into comprehensive income. The main consideration is that these are labor incomes, which are similar in nature, and operating income is similar to labor income in principle." Li Hua made an analogy: individuals are taken by the unit. Employment earns wages and salaries, and business income is equivalent to hiring yourself.
There are a wide range of business income, including income from individual industrial and commercial households engaged in production and business activities, individual sole proprietorship enterprise investors, and individual partners of partnership enterprises derived from domestically registered individual sole proprietorship enterprises, partnership enterprise production and operation income; individual to enterprise, Income obtained from contractual operations, lease operations, subcontracting, and subletting of public institutions.
Liang Ji, a researcher at the Chinese Academy of Fiscal Sciences, believes that with the advent of the gig economy era, it is more and more difficult to clearly distinguish between income from production and operation and income from labor, so it is necessary to include them in the comprehensive calculation.
In terms of tax calculation model, operating income is also similar to comprehensive income. Both currently apply progressive tax rates, and it is relatively easy to incorporate into the comprehensive taxation scope.
The only difficulty is the difference in tax rates between the two.
The taxable income of comprehensive income is the income minus the balance of the 60,000 yuan exemption, special deduction, special additional deduction, etc., and then a total of 7 grades of excess progressive tax rates of 3%-45% are applied; the taxable income of business income is the total income minus Excluding costs, expenses and the balance after losses, a total of 5 grades of excess progressive tax rates of 5% to 35% are applicable.
Some people suggest that in the future, consideration can be given to appropriately lowering the 45% maximum marginal tax rate on comprehensive income.
Overall consideration of tax rate levels
In fact, the call for lowering the maximum marginal tax rate of 45% for individual tax has been around for a long time.
On August 31, 2018, the fifth meeting of the Standing Committee of the 13th National People's Congress held its closing meeting. At this meeting, 3 laws were passed, namely the E-commerce Law, the Soil Pollution Prevention Law and the newly revised Personal Income Tax Law .
Subsequently, the General Office of the Standing Committee of the National People's Congress held a special press conference on three laws in the Great Hall of the People. The reporters on the scene asked a total of 12 questions, including 8 related to personal taxes.
A reporter asked: Should the current marginal tax rate of 45% be lowered to a certain extent, and will it change according to actual conditions in the subsequent tax reform?
Wang Jianfan, Director of the Taxation Department of the Ministry of Finance, replied: The tax rate of 45%, this question still needs to be considered comprehensively.
The new tax law introduced a combination of measures to reduce the burden of taxpayers, so these people who apply the 45% tax rate also have tax cuts.
However, he also pointed out that the large income distribution gap in my country is still quite prominent, so the design of the tax rate structure of personal income tax, including the design of the highest marginal tax rate, must take into account the requirements of adjusting income distribution.
In the next step, with the continuous improvement of collection and management and supporting conditions, this will be considered as a whole.
For a long time, many scholars have suggested to moderately lower the 45% maximum marginal tax rate.
Jia Kang, the dean of the China Academy of Supply Economics and the former director of the Institute of Fiscal Science of the Ministry of Finance, believes that this level of tax burden will undoubtedly regulate high income, but enterprises are facing the difficulty of stabilizing the high-end talent team.
"High-end talents will vote with their feet. If domestic tax is high, they will be pulled away by overseas companies." Jia Kang said that this has caused tremendous pressure on the market. Therefore, since 2019, my country has had a major impact on the Guangdong-Hong Kong-Macao Greater Bay Area, High-end talents or talents in short supply in the Lingang area of Shanghai Free Trade Zone, Hainan Free Trade Port and other places have introduced preferential tax measures to reduce the tax burden of related talents.
Liu Kun’s article did not mention whether to consider lowering the maximum marginal tax rate during the 14th Five-Year Plan period, but scholars generally believe that “improving the policy system for attracting high-end foreign talents” will actually involve this point, and it is only the scope of application. And adjust the magnitude of the problem.
"From an international point of view, the highest marginal tax rate for individual taxes is generally around 30%-35%. We obviously have room for reduction, and we feel the urgency in real life." Jia Kang called on relevant departments to consider tracking them as soon as possible. Analyze the actual operation situation, and if necessary, keep up with some measures to alleviate the contradiction in time. If the personal tax can initiate the next round of reforms, lowering the maximum marginal tax rate and appropriately expanding the scope of the syndrome tax to include some non-labor income should be combined.
Tilt towards people's livelihood
The measures that are closest to people's livelihood in this round of tax reform are the introduction of six special additional deduction policies, including children's education, continuing education, medical treatment for serious illnesses, housing loan interest or housing rent, and support for the elderly.
This action takes into account the different actual expenditure burdens of individuals or families, and gives corresponding tax deductions to make the personal tax system more fair.
Li Xuhong believes that the six special additional deduction policies reflect the characteristics of taxation policies that are leaning toward the people's livelihood, which will help to reasonably reduce the overall burden of taxpayers, effectively ensure that the tax system reform is implemented, benefit people's livelihood, and improve the fairness of the tax system.
Shi Zhengwen, director of the Finance and Taxation Law Research Center of China University of Political Science and Law, also highly praised this. He said that the six special additional deduction policies were designed with horizontal fairness in mind, and the progress is great.
"This is the category of deductions for livelihood expenses, and livelihood expenses reflect the protection of people's livelihood."
At present, in addition to allowing personal medical care deductions within the limit of 80,000 yuan, the other 5 special additional deductions are all deducted at a fixed rate. For example, the deduction standard for each child's education is 1,000 yuan per month, and the housing loan interest is also 1,000 yuan per month. , The deduction standard for supporting the elderly (only child) is 2,000 yuan per month.
Shi Zhengwen told reporters from China Youth Daily and China Youth Daily that the current fixed deduction method is based on the simple consideration of collection and management on the one hand, and the financial affordability on the other.
But the problem is also obvious-the inability to truly and accurately reflect the specific amount of a taxpayer’s expenditure on a certain subsistence expense will cause unfairness to a certain extent.
Liu Kun stated that the next step is to improve the special additional deductions, which means that the special additional deductions will be further reformed.
Previously, Vice Minister of Finance Cheng Lihua stated that the interim measures for special additional deductions for individual tax will be dynamically adjusted during the implementation process based on changes in expenditures on education, housing, medical care, and pensions.
Shi Zhengwen believes that the next step to improve the special additional deductions is mainly to dynamically adjust the deduction standards to further help individuals and families reduce the burden.
For example, the deduction content is more comprehensive, the deduction method is more scientific, and the deduction standard is closer to the amount of actual expenditure.
Liang Ji suggested that the actual deduction of mortgage interest can be considered, because the real data of mortgage interest is available to both taxpayers and collection agencies, and this is more maneuverable.
There is also the improvement of the second-child deduction policy to encourage childbirth and alleviate the problem of population aging.
Currently, special additional deductions mainly benefit young taxpayers.
Li Xuhong has done a lot of related research. She said that the special additional deduction policy is very important to people's livelihood. The next step should be based on the actual factors such as the regional economic development level, family structure, actual burden, etc., to develop moderately differentiated deduction standards and allow deduction standards. Fluctuate within a reasonable range according to the economic and social development status and the needs of macro-control, and balance certainty and flexibility, and balance fairness and efficiency.
At the same time, comprehensively consider the tax characteristics of each taxpaying group, balance the benefits of different taxation groups, increase targeted deductions for special groups and disadvantaged groups, take care of all aspects of people's livelihood, give full play to the redistribution function of personal income tax, and further improve Tax fairness improves people’s well-being.
Make a big tax cake
Gao Peiyong, vice president of the Chinese Academy of Social Sciences and member of the Faculty of Science, once said that the reform of direct taxation during the "14th Five-Year Plan" period is very crucial.
The optimization of the current tax system structure in my country is to realize the modern taxation function, that is, to achieve fairness and justice through the arrangement of the taxation system, which relies on the construction of direct taxation.
Direct taxes refer to taxes that are not easily passed on and are directly borne by taxpayers, such as income taxes and property taxes; indirect taxes refer to taxes that are ultimately borne by consumers through layers of circulation, such as value-added taxes and consumption taxes.
The difference between the two lies in whether it can be transferred in theory, that is, whether the taxpayer and the taxpayer are the same.
Shi Zhengwen stated that the central idea of tax reform in my country’s 14th Five-Year Plan is to optimize the structure of the tax system, establish a more scientific, fair, and standardized modern tax system, so as to better play the role of taxation in income distribution. The role of regulation is to better promote social equity, promote shared development, and promote modern national governance.
He believes that the key to increasing the proportion of direct tax is to deepen the reform of personal income tax. It is necessary to further adjust the tax rate and improve the expense deduction system, as well as to plan to increase the scale of personal income tax as a whole.
In 2019, my country's personal income tax revenue was 1,038.8 billion yuan, accounting for 6.6% of the national tax revenue.
"From the perspective of scale, a tax is a trillion-yuan tax, but from a proportional point of view, the tax is still a small tax. It is still difficult to let it pull the income distribution fair." Li Hua said, only to do A big tax can really play a role in regulating income.
At present, the proportion of personal tax in my country’s tax revenue is still relatively low compared to some developed countries. Vice Minister of Finance Cheng Lihua previously stated that with the development of my country’s economy, everyone’s income level is increasing, and the country has also adopted a A series of measures are improving the structure of income distribution. In the future, more and more people will be able to enter the ranks of individual income taxpayers. This is also an experience from developed countries. The contribution of individual income tax to taxation may continue to Has risen.
She also said that with the continuous advancement of reforms, my country will gradually move towards a standardized comprehensive and classified personal income tax system, which will surely play a better role in raising fiscal revenue and regulating income distribution.
This is a systematic project.
Regarding the development direction of the personal tax, Jia Kang said that the tax burden should be further reduced among the low- and middle-income groups, and appropriate consideration should be given to not increasing the tax burden among the middle-income groups. The taxation of real high-income groups should be strengthened, but attention should also be paid The balance between enthusiasm and fairness reduces the obvious tax discrimination and excessive intensity of labor income in the adjustment of high-end income.
The key to optimizing redistribution is to "raise the low and control the high" and solve the problem in the process of continuous improvement.
The "Proposal" says this: "Improve the people's quality of life and raise the level of social construction." Behind all this is "fairness" and "people's livelihood."
China Youth Daily and China Youth Daily reporter Zhang Junbin Source: China Youth Daily