After reading this article you will learn about:- 1. Definition and Characteristics of Tax 2. Objectives of Taxation 3. Principles. Definition of Tax: In every country major part of the revenue is raised through taxation. According to Prof. Taylor "Taxes are compulsory payments to governments without expectations of direct return or benefit to the tax payer". Prof. Bastable "defined a [...]
This article throws light upon the three main criterions for defining the concept of optimal taxation. The criterions are: 1. Minimization of Resource Cost 2. Equity Criteria 3. Efficiency Criteria. Criteria # 1. Minimization of Resource Cost: A tax system usually involves cost of collection to the authorities and a resource cost to the taxpayers. However, in deciding on alternative [...]
This article throws light upon the three main principles for equitable distribution of tax burden. The principles are: 1. The Cost of Service Principle 2. The Benefit Principle 3. Ability to Pay Theory. 1. The Cost of Service Principle: This principle suggest that the cost incurred by the government in providing public goods to satisfy social wants should be regarded [...]