Microsimulation of Personal Income Tax Reform

This paper provides a static microsimulation model to analyze policy effects of personal income tax reform in China.The income states of the individuals are updated by income tuning,income aging and tax system running,the policy effects are estimated by statistical methods on individuals.We do some simulation experiments of personal income tax reform with Changchun micro-data.The results show that though personal income tax reform reduces fiscal income and cannot narrow gross income inequality,but the ratio of medium income households can be expanded and tax justice can be accomplished.