In the context of continuous economic downturn, China has launched a fiscal policy of tax and fee reduction in recent years. This paper studies the pricing problem of deposit insurance considering bank income tax and obtains the explicit solution of deposit insurance price. We also test the mechanism of bank income tax affecting deposit insurance price. It clearly shows that the premium per unit deposit decreases with the decrease of income tax rate, which proves the positive effect of tax and fee reduction policy on banks. The empirical results show that the increase of bank income tax rate will increase the deposit insurance rate by increasing the risk-taking level of the bank. The study in this paper provides theoretical basis and practical reference for further promoting the implementation of tax and fee reduction policies in the commercial bank system in the future.