Ever wonder what is the difference between developed and non-developed countries? A country that has a high-quality life, developed economy, and advanced technology infrastructure is a developed country while a country that has less income and an unbalanced economy is a non-developed country. So, the Developed Society leads to the Developed Nation.
One can dream of living in a developed society. So, if you want to bring changes in society and contribute towards development, “Start Paying Taxes”. The taxation system is one of the best tools in the development of society. As citizens, it is our responsibility to make sure that our country is doing well socially and economically. Laws of Taxation must be levied on every citizen so everyone pays tax so it will not affect our country’s growth anymore. The government must consider some laws in collecting taxes so that the amount may be collected properly and spent on the desired objectives. I.e On Infrastructure, health institutions, educational institutions, and many more.
There are some Laws Of Taxation that well-known economist Adam Smith described. These laws are as follows
Laws Of Taxation
Laws of taxation play an important role in the development of the country. The government and the citizen must consider these laws while collecting or paying respectively.
Law of Equality
The Law of Equality is one of the most important laws described by Adam Smith. The “law of equality” must be considered while laying down the principles of taxation said by Adam Smith. I.e every person should pay tax according to his/her status. A person with more income should pay more tax while a person with smaller income should pay a smaller amount of tax and a person with no income should not pay tax. Everybody has to pay taxes according to his/her financial status and then add to the government revenue accordingly to the law. If the tax levy on every person at the same rate, it will burden the poor, which will be unbearable for them. So, the “Law of Equality” should be considered by the government while collecting the revenues
Law of Certainty
This is another law “Law of Certainty” that was described by Adam Smith. According to this law, the taxpayer should know how much tax he has to pay and where tax should be paid. Likewise, the government should also know with certainty how much income they are generating from taxes and other revenue sources, and where to apply these amounts collected through taxes.
Law of Convenience
The system of taxation should provide ease to its taxpayers so they can easily pay taxes at the right time. They should not levy tax on the poor person who earns no amount. Tax should be levied on the person who earns, and he/she should pay taxes conveniently. I.e the tax should be collected from the salaried person in the first week of the month. Likewise, payment of taxes should be deposited at the nearest places so that the taxpayers do not travel long, and their time & money don’t waste.
Law of Economy
The “Law of Economy” plays an important role while collecting taxes. The Law of the Economy means that taxes should be collected in a way that involves less expenditure and maximum revenue should be collected. I.e If there are few persons who are taxpayers but they are honest, but the staff who is collecting amount are in huge numbers, the collected amount will be spent on their salaries, so there would no advantage of the amount collected to the government. So tax should be collected in a way that the government will face less expenditure and more revenue should be generated, so the government would spend more on the development of the country.
Now the question arises which is the best taxation system and will be suitable? The government which follows the laws that are explained above would lead to the best and most suitable taxation system, which includes equality, justice, the law of convenience, certainty, and economy.
A government should practice these laws to make the system smooth and reliable which would lead the way to social development.
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