Abstract:In order to cope with the current domestic and international economic situation and promote the high-quality development of Chinas economy, the Chinese government will continue to increase tax and fee reductions in 2019.The outbreak of the COVID-19 epidemic in 2020 has raised expectations of further tax cuts, with corporate income tax a long term focus. Based on the micro-survey data of enterprises in China, this study established a micro-simulation model of corporate income tax in line with Chinas actual conditions and needs, and used this model to conduct sensitivity analysis of current corporate income tax policy parameters and simulate key reform options that are feasible control analysis. It is found that the inclusive tax reduction policy has played a positive role in promoting the development of Chinese enterprises, stimulating economic growth and stabilizing social employment. However, there are some structural mismatches in the current corporate income tax reform, the policy effect is uncoordinated. On this basis, the study further put forward targeted policy recommendations, trying to provide a reference basis for future reform of corporate income tax.

Key words:corporate income tax; tax incidence; micro-simulation; tax reduction