Merits of direct taxes, Managerial Economics

Merits of direct taxes

a.  They satisfy the principle of equity as they are easily matched to the tax payers capacity to pay once assessed.

b.  They satisfy the principles of certainty and convenience to tax payers as they know the time and manner of payment, and the amount to be paid in the case of these taxes.  Similarly, the government is also certain as to the amount of money it shall receive from these taxes.

c. They satisfy the Canon Simplicity as they are easy to understand.

d. Because most of them are progressive, they tend to reduce income inequalities as the rich are taxed heavily through income tax, wealth tax, expenditure tax, excess profit, gift tax, etc. so long as they are alive; and through inheritance taxes or death duties when they die.  The poor and the income groups which are below the minimum tax limit are exempted form these taxes.  These taxes thus reduce income and wealth inequalities because of their progressive nature.

e. Because the public are paying taxes to the government, they take an interest in the activities of the state as to whether the public expenditure is incurred on public welfare or not.  Such civic consciousness puts a check on the wastage of the public expenditure in a democratic country.

Posted Date: 11/30/2012 3:09:22 AM | Location : United States







Related Discussions:- Merits of direct taxes, Assignment Help, Ask Question on Merits of direct taxes, Get Answer, Expert's Help, Merits of direct taxes Discussions

Write discussion on Merits of direct taxes
Your posts are moderated
Related Questions
Real Rigidities The New Keynesian economists  rely both on nominal and real rigidities to  arrive at their conclusion that nominal changes in money  supply have real, and not

Q. Show the Characteristics of monopoly? Let's summarise the main characteristics of monopoly as under: Cross-elasticity of demand for a monopoly product is zero in the

define scarcity and opportunity cost.Show how these concept are useful in managerial decision making

Advantages of the Mixed Economy Necessary services are provided in a true market economy, services which were not able to make profit would not be provided. Incentive:  Sin

Q. What do you mean by Oligopoly? Type of market condition that is most appropriate in the today's economy, is oligopoly. It's characterised by mutual interdependence among a f

Suppose that, in their divorce settlement, Ashton Kutcher offers Demi Moore $16 million spread evenly over 8 years (with the 1st payment upfront and the 2nd payment at the end of y

Q. Explain the Shut down point? ShutdownPoint: With MR = MC, firm attains equilibrium at point E where it produces OM amount of the output. To produce this output, firm incur

Disadvantages of product differentiation   a) Product differentiation generally reduces the degree of competition in the market.  It does this in two ways:          i.

Explain about the terms in perfect competition. Perfect Competition: a. A price-taking producer is a maker whose actions have no consequence onto the market price of the g

Problem 1: Using relevant examples, discuss the pricing strategies that firms can use to capture value from their customers. Problem 2: You are a manager in a perfectl