Taxation Essay Example | Topics and Well Written Essays - 1500 words - 5

Taxation - Essay Example A good example is the when the tax revenue collected is allocated towards paying for government services such as the police, the military and the government administration. Taxes are also collected for purposes of subsidizing the needs of its citizens such as the subsidization of a staple food or education. Taxation carries the weight of bearing the load of administration as well as providing its citizens a chance to run their country. As taxpayers many people are given the opportunity over voting rights as well as social security and welfare in times of hardship. Consumption Tax: It is a system whose tax base is consumption. This includes the goods bought by an individual. The most common is the VAT (Value Added Tax) and is added already on all legal goods that are being purchased. Excises: Excise does not depend on the quality of the object rather, based on quantity amount of tax payable is calculated. It modifies the consumption pattern of user. If excise in alcohol is made higher then, rate of alcohol consumption will definitely come down. Income Tax: Tax imposed on financial income of the person is known as income tax. Income taxes are also inclusive of the profits of a business if the individual is self-employed. This tax is inclusive of a person’s savings in correlation to the amount of money that has been saved. Poll Tax: Poll tax is the fixed amount of tax that is levied to each and every individual irrespective of his/her financial strength. Though they are cheap and easily manageable but, it has one basic drawback: Poorer people need to pay higher proportion than rich persons. Property Tax: Individuals who own property are required to pay a certain amount of tax. Inheritance taxes, Stamp Duties and a tax on gifts that you have made seven years before an individuals’ death. This tax is also inclusive of all the properties a UK citizen has overseas whether or not money is brought into the