How many modes of collection of personal income tax in China and what are the advantages and disadvantages?

A brief description of the collection mode and its advantages and disadvantages:

1. There are three types of collection modes of personal income tax: categorized collection system, comprehensive collection system and mixed collection system.

2. Categorical taxation system is to tax the income items of different sources and natures of taxpayers at different rates;

3. Comprehensive taxation system is to summarize the income of taxpayers for the whole year and tax the total amount;

4. Mixed taxation system is to tax the income of taxpayers at different rates for the different sources and natures of taxpayers, and then to summarize the income of the whole year for the total amount. Then the various incomes for the year are taxed in aggregate.

2. Advantages: China's implementation of categorized income tax system is more suitable for the current stage of China's development. Under the objective conditions (China's personal credit system is not developed, tax awareness is not high enough), it is difficult for the tax authorities to control the source of personal income tax, while the classification system helps the tax authorities to control the source of personal income and ensure the national tax revenue.

Third, the disadvantages: a single categorized income tax system generated by the unfairness of the problem, categorized income tax can not comprehensively measure the taxpayer's true ability to pay taxes! It will result in the phenomenon that people with many sources of income tax and high comprehensive income pay less tax, while people with few sources of income tax and relatively concentrated income pay more tax.

Expanded information:

I. Individual income tax is based on different taxable items, respectively, three different tax rates are provided for:

Comprehensive income (wages, Salary income, income from labor remuneration, income from manuscripts, and income from royalties), is taxed by applying a 7-tier super progressive tax rate, and the tax is calculated on the basis of the monthly taxable income. The tax rate is divided into bands according to the individual's monthly taxable income from wages and salaries, with the highest band at 45% and the lowest band at 3%, ****7 bands.

Operating income is subject to a 5-tier over-progressive tax rate. The annual taxable income of individual industrial and commercial households of production and business income and contracting and leasing operations to enterprises and public institutions applicable to annual calculation and monthly tax prepayment are divided into grades, with the lowest grade being 5% and the highest grade being 35%, ****5 grades.

Proportional tax rates. Individual income tax on interest, dividend and bonus income, property rental income, property transfer income, incidental income and other income is levied on a per-income basis, and a proportional tax rate of 20% is applied.

II. Collection Management

Chinese individual income tax is collected by means of both withholding at source and self-declaration, with emphasis on withholding at source.

Individual income tax can be collected on a monthly or annual basis. Income from production and operation of individual industrial and commercial households, income from contracting and leasing to enterprises and institutions, income from wages and salaries in specific industries, and income from outside China are taxed on an annual basis, while other income is taxed on a monthly basis.

Baidu Encyclopedia - Individual Income Tax