by Gouvernement du Quebec, Ministere des Finances .
Written in English
|The Physical Object|
|Number of Pages||45|
of tax in maintaining those societies is undiminished. The three functions of a tax system (revenue raising, redistribution and regulation of economic behaviour) will be achieved in different ways at different times. As policy makers react to change, and seek to influence it themselves, they will be faced with choices over what to tax, and howFile Size: KB. The tax system could not function if denominations were allowed to challenge it because tax payments were spent in a manner that violates their religious belief. Because the broad public interest in maintaining a sound tax system is of such a high order, religious belief in conflict with the payment of taxes affords no basis for resisting the tax. The fundamental purpose of taxation is to raise the revenue necessary to fund public services. While there are many ways to achieve this goal, a widely agreed-upon set of principles should be used to evaluate tax systems. This policy brief provides a basic overview of five commonly cited principles of sound tax policy: equity, adequacy, simplicity, exportability, and neutrality. Tax, should be levied according to the ability of the people, the index of ability being income and family circumstances and; Similarly placed persons should pay similar taxes to avoid any discrimination. From the discussion above, we may lay down the following four broad characteristics as the principles of a sound tax system.
Views on Sound Tax System: 1. Modern View on Sound Tax System: Many modern workers have multiplied the requirements of a sound tax system. Usually it is agreed that a sound tax system should be based upon the principle of progression. Proportional and . 1. Fiscal Adequacy- The sources (proceeds) of tax revenue should coincide with and approximate needs of government expenditures. The sources of revenue should be sufficient and elastic to meet the demands of public expenditures; 2. Theoretical Justice- The tax system should be fair to the average taxpayer and based upon his ability to pay. Taxes are a way for the government to pool some amount of important resources from the private sector to the public one, according to the IRS. The ability of the government to provide basic safety and community systems with tax revenue is important to maintaining the freedoms and basic living standards that typical Americans expect. The Ascent is The Motley Fool's new personal finance brand devoted to helping you live a richer life. Tax Update: What's Wrong With Our Tax System and How to Fix It That might sound scary.
An approach to taxation that goes beyond an emphasis on tax rates to consider such aspects as administration, compliance, and remittance. Despite its theoretical elegance, the standard optimal tax model has significant limitations. In this book, Joel Slemrod and Christian Gillitzer argue that tax analysis must move beyond the emphasis on optimal tax rates and bases to consider such aspects of. Basic Principles of a Sound Tax System 8 August This principle states that the sources of revenue of the government should be sufficient to meet the demand of the public expenditures regardless of business condition, export taxes, trade balances, and problems of economic adjustment. Some tax reformers have proposed adopting this system as a "flat tax" to replace the progressive federal income tax. Finally, regressive taxes impose higher rates on people with lower incomes. The poorer you are, the higher percentage of your income you pay in taxes. The federal payroll tax is a regressive tax, since it is capped at $97, term. Also the purpose of a good tax system should include meeting social objectives to improve human development (such as a welfare system, poverty eradication, health care, education and so on). A good tax system is strategic: Being strategic means that the tax system must be stable and consistent, enabling long-term business investment.