A country or a state has many responsibilities towards its citizens. They are tasked with taking care of our safety, security, freedom, and a plethora of other elements that we as citizens deserve to have. They maintain law and order so that we can lead our lives in peace. They make sure that we have the necessities of life like water, electricity, public utilities, and more. Our countries and states are also responsible for maintaining friendly ties with other countries and states so that we can promote business opportunities in our countries as well as abroad. But for the government to do so, it needs something from its citizens. One of the things that the government needs are revenue. For the government to ensure that its citizens get all the benefits that they have been promised, it needs money to build infrastructures and enforce the law. This revenue is collected through different sources. These sources are the taxes that we pay, the fines that the government charges as well as fees, penalties, and other sources as well. The main source of revenue among all of them is tax. This is how the government fulfills most of its requirements.
History of Tax
The history of taxes can be traced back to Great Britain. When Great Britain was at war with France, it collected revenues to support the war. Once the war was over, the collection of tax stopped, and for a long time, it didn’t exist. Then it again resurfaced around 1840 and started being implemented by various countries around the world.
Nowadays, the tax has become an important part of any government. Governments around the world use this source of revenue to build roads, provide security and safety, healthcare, infrastructure, and a plethora of other things to its citizens like you and me. It has also become a popular field of study, and more and more people are interested in a career in taxation. You, too, can become a taxation consultant by applying for the master of taxation online and getting your degree.
Essentials of Tax
Certain things need to be considered about taxes. The first one is that everyone who earns an income that exceeds a certain limit has to pay taxes. No one is exempt from it, unless in special situations. According to the tax laws of the country or state that you currently reside in, you will have to pay the proper amount. Otherwise, you will have to face the consequences. Another thing to consider here is that even though you might pay your taxes, you will not receive any direct or special reward for paying it. The taxes are for more general purposes. The government has the right to decide where and when to spend those tax amounts to give the maximum benefit to its citizens.
What are the objectives of Tax
As discussed before, the main objective of collecting tax is to ensure that the government provides its citizens with the benefits that it has promised or the benefits that they deserve to have. These benefits include various welfare programs as well as development programs. These can include better arrangements for retired people, basic healthcare for every citizen, better roads to enable business people to get their products and services to the customers, and a plethora of other things. Various countries around the world perform different activities for their people, including the ones mentioned above. Tax is also collected from the people who are making an income above the margin set by the government to ensure equality among different classes of people. This way, the people who make more pay taxes so that the government can take care of the homeless, the jobless, and others. Taxes can also be used to promote the usage of locally made or grown products, so that import trade is discouraged, and people are motivated and inspired to approach local and national industries.
Importance of Tax Laws
The taxation laws are there for a reason. These are some of the reasons why they are so important for the government as well as for individuals and businesses.
Legalities
Without tax laws, you wouldn’t know the legalities of various matters like when is tax mandatory for you as an individual or as a business and other concepts related to tax.
Protection
Tax laws are also there to make sure that individuals and organizations pay the taxes that they are supposed to pay and also to make sure that they are not forced to pay the taxes that they are exempt from. According to the current status of any individual or business organization, certain taxes may be levied. If the individual or the business doesn’t know about them, they won’t be able to benefit from them.
Errors
Taxation laws also exist so that there are fewer errors when filing the taxes. The more you know the taxation law, the fewer number of errors there will be, and the more you can save your money.
Conclusion
Taxes are there for a reason, and that is why they are so important for individuals as well as businesses. The entire system depends on a set of checks and balances that are put forward by the government to make sure that everyone pays what they must and not more. Taxation laws tell us about all of this and more.
