Tax — a compulsory contribution to state revenue, levied by the government on workers’ income and business profits, so that it can pay for public services.

Tax — a compulsory contribution to state revenue, levied by the government on workers’ income and business profits, so that it can pay for public services.

Types

Direct tax - tax which is collected directly from the person or company who pays it, for example income tax.

Indirect tax - tax which, is collected from businesses on the goods and services that people buy from them

Capital gain tax

VAT

Inheritance tax

Income Tax

Sales tax

Excise tax

Property tax

Principles

Benefit principle

Ability-to-pay principle

a theory that states that the people a theory that states that the people those who benefit less.

Types

Proportional tax

Regressive tax

Progressive tax

is one that takes а larger percentage of a higher income and а smaller percentage of a lower income(ex. income tax).

fixed tax is one that takes the same percentage of all incomes regardless of size.

is one that takes a higher percentage of a low income and a lower percentage of a high income (ex. sales tax).

Criteria for Effective Taxes

Equity

Simplicity

Efficiency

Corporation tax

Special tax (Tariffs)

a theory that states that people who earn more money should pay more tax, so that there are higher rates of tax on higher incomes.