Taxes

Benjamin Frankin said "In this world nothing can be said to be certain, except death and taxes." in 1789.In fact, he was not the first person to complain about taxes.Governments has tried to collect money by various methods since existence.King William was prepared the Domesday records to find out who will tax;Chinese citizens must pay the income tax since A.C 10.

             Even taxes today,one of the most controversial subjects in policy.President George H.W. Bush still to be remembered "Read my lips:No new taxes." Unfortunately,the fiscal status of State contradicted him and after four years with a few tax increases,the voter makes a choice against him at the next election.

             People since the beginning of history,they were rightly opposed to struggling and taking their money from their hands.Moreover,past collectors more cruel than the current tax collectors.Those days, if the villagers and workers couldn't pay their taxes,they had to sell their wives and sisters as slaves.Having to give taxes without giving direction to the politics (for example, without the right to vote) causes many complaints and eventually the signing of Magna Carta in 1215, the French Revolution, the Boston Tea Party and the American Civil War.
       
              The tax on all these examples,remains on the heap as well as the fact that many citizens of the world today have to give.Those days, in general the taxes less than 10% and not taken annually;there is temporary taxes collected during wars.Today,even in Switzerland, which has never entered the war, an average worker pays 30% of her/his salary.

             The Art of Taxation What changed? Basically, welfare state and social security systems were born in the last half of the 20th century.The countries around the World,promised to pay public securitys pendings,health,education,unemployment,old-age insurances.They had to provide this extra money;because they need to spend more than their old counterparts.Taxation was the solution.

             It's not just income taxes (deductions based on someone's salary).Hereafter governments could choose inside of huge tax menu:Value gain tax(A deductible tax from the sale of an investment that is valued),inheritance tax (the taxes placed on the deceased),estate tax (the taxes placed on real estate);import and export tariff taxes(also known as customs duty),environmental tax(oscillation taxes) and wealth taxes(taxes from one person's assets).

             In lots of country both government and local managements have tax collection authority.The local managements trust to estate taxes,government trust to income taxes.

            In that case,since middle of the 20th century,The taxes assume the task of fund-raising institutions that protect citizens (army, police, emergency services etc.), as well as redistributing wealth among those who are rich and needy.Also in general,as the country gets richer,the taxes will increase which is taken from.

            Smith's Tax Rules He determined four rules for taxation in his book:

1. People should contribute by proportional with their incomes.This mean the higher earners will pay higher taxes.The progressive income tax applied in lots of countries;high income groups pay taxes higher than poor groups.Both of tax rates and tax invoices is higher.Today, there is an income tax exemption in the increasingly proportional income tax system.After this segment is overpaid, people pay a certain amount of taxes from their salaries to a certain amount,When this amount is exceeded, they pay more taxes and this goes like this.
2. The taxes don't be arbitrary,must be accurate.Time and payment method should be open to everyone.
3. The taxes should collect in an appropriate time.
4. Taxes should not be more than necessary for both the citizen and the state.In other words,the choices people make in their everyday lives should be as effective as very little.Increasing the marginal tax rate can prevent people from working harder.But,it is a very important argument issue because some of people think like the tax system will encourage the people to do "good things" and as a tool to keep him/her away from others.For instance, governments take high taxes from cigarettes and alcohol for public health.

Limits of  the taxation As the taxes increases,people search for the way of payments.As the taxes many governments of the world encountered with that situation.Some of workers be obliged to pay %70 or higher marginal tax rate(o,the tax they pay for every earned extra dollars and pounds).Rather than doing extra work, they started to work less, pay pensions instead of paying extra income, or carry their money to overseas countries.In an age when money can be transferred from one part of the world to another by pressing a single button, it has become very difficult to prevent the overseas transfer of money.That is why governments have to keep their taxes very competitive.However, over time taxes began to overlap on to each other, and each passing day the system beczme more complex and stubborn.Young William Pitt,when he put into action the first income tax of England in 1798, he insisted on that like it just a temporary for Napoleon Wars for defray the war expenditures.

Ricardo Equality

           The theory of Ricardo Equality (took its name exactly from David Ricardo) upholds that governments should not finance tax reduction by taking debt.

            In general tax reduction seems like good way for the reinvigorate the economy: There will be more money in pockets of people and in theory they spend this money.However, governments to borrow money to cover the tax reduction, according to some economists it provides no benefit.Because it will be temporary solution and it will come back with more tax and more less public expenditure in the future.The Theory of Ricardo EqualityEven if it criticizes the unwarranted tax reductions,this idea don't be effective to stop politicians.

What do I mean by all these paragraphs? 

• "Taxes are as inevitable as death."

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