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Inspired by the local dimming technology in liquid crystal displays, we propose a modified wide-angle beam propagation formulation with local reference indices for the first time to improve the performance in wide-angle simulation. The reference indices in the proposed formulation are spatially varying in both propagation and transverse directions, instead of a single reference index over the whole computation domain as in commonly used formulation. The proposed formulation is simple and only a minor modification from conventional one, and extra computation effort is relatively small. It can greatly improve the accuracy in modeling for wide-angle cases.