근로소득세의 공제제도 유형에 따른 세부담 효과 분석

The scope and limit of each deduction type on earned income, according to the Earned Income Tax Act, have continuously changed. Most deduction items have been applied in the form of earned income deduction thus far. However, most existing earned income deduction items have been converted to employment income tax credit type from the year－end tax adjustment of 2014 through recent tax act amendment. The purpose of this study is to comparatively compare the difference of tax burden in the year－end tax adjustment, according to the earned income deduction and employment income tax credit of each income earner bracket by reflecting such recent revised bill. This study ultimately aims to find out problems and future improvements in the deduction type conversion on earned income tax. To this end, this study analyzes the literature review method comparing and reviewing the application differences of earned income deduction and employment income tax credit under the current earned income systems of Korea and some major countries. This study also analyzes the differences of tax burden support effects by income earner bracket, according to recent earned income tax deduction system conversion, using virtual examples. As a result of the analysis in this study, the following improvement measures are presented：First, it is desirable to simplify deduction modes, according to the characteristics or criteria of each spending item. Second, earned income deduction should be conducted by acknowledging the expenses burdened by income earners as necessary expenses, while avoiding budget credit type earned income deduction to ease earned income tax deduction system’s differential application. Lastly, the duplicate support exclusion of earned income deduction and employment income tax credit or the downward adjustment of deduction rate is required in linkage with the second improvement measure above.