Taxation

    Cards (54)

    • What is taxation?

      The system by which a government collects money from citizens and businesses to fund public services.
    • Define revenue in terms of government finance
      The income generated by the government from taxes, fees, and other sources.
    • What is equity in taxation?
      The principle that taxes should be fair and based on a person's ability to pay.
    • What is fiscal policy?
      Government policies regarding taxation and spending to influence the economy.
    • What does redistribution mean?
      The process of transferring income or wealth from some individuals to others, typically via taxation.
    • Why do governments collect taxes?
      To fund public services, redistribute wealth, regulate the economy, provide public goods, and control inflation.
    • What public services do taxes fund?
      Essential services like healthcare, education, infrastructure, and national defense.
    • How do taxes contribute to the redistribution of wealth?
      Taxes help reduce income inequality by funding welfare programs and social safety nets.
    • How do taxes regulate the economy?
      Taxes can encourage or discourage activities, such as taxing harmful goods or offering credits for green energy.
    • What are examples of public goods, and how are they funded?
      Public goods, like roads and clean water, benefit everyone and are funded through taxes since they aren't provided by individuals or businesses.
    • How can taxes help control inflation?
      By adjusting tax rates, governments can manage overall demand, influencing inflation or deflation.
    • Why do governments collect taxes?
      • Revenue for public services
      • Redistribution of wealth
      • Economic regulation
      • Provision of public goods
      • Control inflation
    • What are the different types of taxes?
      • Property Tax
      • Income Tax
      • Excise Tax
      • Corporate Tax
      • Capital Gains Tax
      • Estate/Inheritance Tax
      • Sales Tax
      • Value Added Tax (VAT)
    • What is capital gains tax?
      A tax applied to profits from the sale of assets like stocks or real estate.
    • What is estate/inheritance tax?
      A tax levied on the transfer of an estate or inheritance after someone dies.
    • What is excise tax?
      A tax applied to specific goods like alcohol, tobacco, and fuel.
    • What is Value-Added Tax (VAT)?
      A consumption tax added to a product at each stage of production.
    • What is corporate tax?
      A tax charged on a company's profits.
    • What is property tax?
      A tax imposed on property ownership, usually real estate.
    • What is a sales tax?

      A tax charged on goods and services at the point of sale.
    • What is income tax?

      A tax levied on individuals' or businesses' earnings.
    • How do higher income taxes impact personal spending?
      Higher income taxes reduce disposable income, potentially lowering overall consumer spending
    • How do sales taxes or VAT affect spending?
      Sales or VAT increases the cost of goods and services, leading people to buy less or shift to lower-priced alternatives.
    • How do tax deductions or credits influence spending behavior?
      Tax deductions/credits encourage behaviors like buying energy-efficient appliances or investing in retirement funds.
    • How do excise taxes impact the purchase of specific products?
      Excise taxes on products like cigarettes or alcohol can deter people from buying them due to the higher cost.
    • What tax factors might influence personal spending habits?
      • Higher Income Tax
      • Sales or VAT
      • Tax Deductions/Credits
      • Excise Taxes
    • Why is it important to understand taxation?
      To grasp how it influences economic activities and the overall welfare of society
    • What are the key principles of taxation?
      • Equity
      • Efficiency
      • Simplicity
      • Certainty
    • What does the equity principle in taxation mean?

      Taxes should be fair and based on the taxpayer's ability to pay.
    • What does the efficiency principle in taxation ensure?

      Taxes should not discourage productive activities.
    • What is the simplicity principle in taxation?

      Tax rules should be easy for taxpayers to understand.
    • What does the certainty principle in taxation mean?

      Taxpayers should clearly understand their tax obligations.
    • What is the main purpose of taxation for governments?
      Taxation is a main source of revenue used to provide public goods and services.
    • How can taxation influence consumer and business spending?
      High taxes on certain goods may discourage consumption, while tax breaks on essential services can encourage spending in specific sectors.
    • What role does taxation play in reducing economic inequality?
      Taxation helps redistribute income from wealthier individuals to lower-income groups, reducing economic inequality.
    • How does taxation support disadvantaged groups in society?
      Government funds from taxes are used to provide social welfare programmes and services that support disadvantaged groups.
    • How do high taxes on certain goods affect economic behaviour?
      High taxes can discourage consumption of those goods.
    • What is the impact of tax breaks on essential services?
      Tax breaks can encourage spending in specific sectors, shaping overall economic behaviour.
    • How do governments use taxation as a tool of fiscal policy?
      By adjusting tax rates to control inflation, employment, and economic growth.
    • What is the economic impact of lower taxes?
      Lower taxes may stimulate economic activity.
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