Taxation

What is taxation?

• A way to delay the payment of tax to a later time

• The tax people pay on their wages and salaries

• A compulsory fee that individuals or corporations must pay to the government

What is the main function of taxation?

• To raise revenue to finance government expenditure

• To economic growth, high employment, and low inflation

• Can help one understand human thought and behavior

What term is this definition of?

"To dissuade people from consuming some non-essential goods and services."

• taxation

• perks

• excise tax

• corporate income tax

........: something which discourages an action

..........: encourages capital invesment with methods of accelerated depreciation accounting.

What are the advantages of different tax systems?

• A progressive tax is designed to redistribute wealth and income

• To ensure social equality, reduce the gap between the rich and the poor

• Both A and B

True or False?

1. A progressive tax is always low, which discourages people from working and investing

2. A regressive tax is fair

3. Business profits are generally taxed twice

• 1. T

  2. T

  3. T

• 1. F

  2. F

  3. T

• 1. T

  2. F

  3. F

• 1. F

  2. T

  3. T

What is a progressive tax called ?

...........: A tax levied at a higher rate on higher incomes

What type of tax does the graph below represent?

• progressive tax

• regressive tax