The tax structure in India can be classified into two main categories
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- Taxation - Key takeaways
Principles of taxationAdam Smith's principles of taxation, also known as canons of taxation, argue that taxes should be: Equitable: the tax system should be fair based on everyone’s ability to pay. Economical: the tax should be cheap to collect. Convenient: the tax should be convenient for taxpayers to pay. Certain: the taxpayer should be certain of the amount of tax they are due to pay. Furthermore, we could add the principles of efficiency and flexibility. The idea of efficiency suggests that the tax should achieve its desired objectives and flexibility implies that the tax should be relatively easy to change in case new circumstances arise. According to Adam Smith's principles of taxation, a relatively well-designed tax should meet many of the principles outlined above, whereas a relatively badly designed tax meets only a few of the principles. Taxation - Key takeawaysTaxation is the compulsory financial charge or some other type of levy imposed upon a taxpayer (an individual or legal entity) by a governmental organization in order to fund various public expenditures. Taxes can be classified or categorized based on various factors. Some of the most common ways to classify taxes include: Direct and inderect taxation Progressive, regressive and propotional taxation Ad valorem and specific taxation Consumption and income taxation Personal and corporate taxation The average tax rate is calculated by dividing the amount of tax paid by income. The marginal tax rate is calculated by dividing the change in tax paid by the change in income. The marginal tax rate is a significant factor when it comes to making decisions about work and leisure, influencing the supply of labour in the economy. Download 24.96 Kb. Do'stlaringiz bilan baham: |
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