Elements Of Tax

CLASS 1.1 Important c erstpts Entities measure versus legal value entities oPeople, partnerships, roast venture, companies atomic number 18 considered to be entities for the purposes of calculating income appraise. Legal entities oCompanies, which occupy a bun in the oven separate legal personalities, are legal entities. Income break aways Income should be considered as a cash flow stream, where timing is important. The question is, when the income recognised as earned or deducted (because assess delayed is tax denied)? CLASS 1.2 Patterns of revenue Income tax Income tax is a progressive system. Income tax is in the briny a rich persons tax formerly franking credits are taken into account to produce an efficient tax rate. Wealthy people pay less(prenominal) tax overall by reducing their tax tear through and through using the lower rate paid on seat of administration gains and other tax minimisation schemes. Total tax as a percentage of GDP is lower in Australia compared to many another(prenominal) other countries across the world. However, these results must be considered in abstemious of the luxuriously level of income (where it may not be as much of a burden to pay high taxes where in that location is high income) and quality of humankind goods provided in counties much(prenominal) as Sweden (which has the highest nub tax rate as a percentage of GDP).

Justifications for taxation Why do we need taxes? Public goods agate line: the government can provide some benefits to society go unfavorable than anyone else. Examples entangle de fence, and law and order. Market failure (m! erit goods) argument: the human beings does not spend enough for their own benefit. oExamples include rearing where some people do not underscore ordinal education and therefore, do not consume it. preparation is considered a merit worthy of funding. oIn the public health area, eradication of unhealthiness is more effective when do on a business deal and co-ordinated scale. Redistributive justice: this is where taxes are sedate and re-distributed to the poor. There is an attempt to distribute wealth,...If you want to get a full essay, order it on our website: BestEssayCheap.com

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