Friday, August 23, 2013

What Is Tax?

Neeta Shah
Neeta Shah 

A fee charged or levied by government on .......

product, income,or activity. directly on personal or corporate in

come, then it is a direct tax. If tax is levied on the price of a good 

or service, then it is called an indirect tax. The purpose 

 of taxation is to finance government expenditure. One of the 

most  important uses of taxes is to finance public 

goods and services, such as street lighting and street cleaning. 

Since public goods and services do not allow a non-payer to be 

excluded, or allow exclusion by a consumer, there cannot be 

a market in the good or service, and so they need to be provided 

by the government or a quasi-government agency, which tend to

 finance themselves largely through taxes.