Abstract: The marginal effect of structural tax cuts policy on supporting the real economy and the industrial structure adjustment is increasingly weakened. Considering the research on small and micro enterprises' tax cuts is scarce and non-systemic, an analytical model of small and micro enterprises' tax rate adjustment is set up. Through the discussion of employees, enterprises and governments' goals, the expressions of key indicators are gotten, and the relationship model of the government' goal and enterprises' tax rate is established with nice propositions are deduced. It shows that tax rate adjustment is the replacement of national preferences of welfare and employment in essence. There isn't any optimal tax rate of small micro enterprises but only the worst one. The current rate is lower than the worst one, and belongs to the left-side tax rate. The evaluation criteria of tax rate depends on its deviation from the worst tax rate, rather than its absolute value. It is also found that under the premise of maintaining the current left-side tax rate, the government can also achieve the effect of structural tax cuts through increasing investment in the fields of vocational training and social health insurance. The foundation of model and the introduction of propositions related enrich the theoretical system of structural tax cuts policy while having certain practical significance on small and micro enterprises' tax rate adjustment.

Key words: small and micro enterprises, structural tax cuts, equilibrium model