Taxation, Theory, Practice and Law

TAXATION, THEORY
PRACTICE AND LAW

TABLE OF CONTENTS
TABLE OF CONTENTS................................................................................................................2
WEEK 1...........................................................................................................................................1
WEEK 2...........................................................................................................................................2
WEEK 3...........................................................................................................................................2
WEEK 4...........................................................................................................................................3
WEEK 5...........................................................................................................................................4
REFERENCES................................................................................................................................6

WEEK 1
Tax refers to enforced fee charged over individuals and the organisations by the
government or statutory authorities over products, income or services. These tax contributions
are very essential for economy of the country. It is because the financial contributions are used
for the development of the country. Taxation performs different functions in the country and
helps in the upliftment of society as whole. Taxation refers to actual act in the government or the
taxing authority actually collects the tax from individuals. Taxation is governed by Income Tax
Assessment Act, 1997 and Australian taxation office collects the tax charged over the taxpayers.
Functions of taxation
 Taxation has to raise revenues for the income and services for supporting the needs of the
community. It is essential for the public to have required revenues for the purpose of
taxation.
 Taxation has the function of charging every individual equitably as per their ability to
pay. The ability of individuals is measured by their income and asset. It ensures
individuals are charged on the equity grounds to pay higher taxes with higher income.
 It establishes age neutrality among the people of different generations. People with the
same ability to pay are charged with same amount of tax regardless of the age.
 Taxation ensures that the tax is raised in such manner which minimises the economic cost
by tax created bias or distortions (Woellner And et.al., 2016). It is dependent mainly over
the revenues raised as overall taxes rose.
 It has the function of making the taxation system transparent simple and predictable. It
focuses over designing the tax structures in manner for minimising the compliance cost
and discouraging wasteful tax avoidance strategies.
 It ensures that community in diversity, views and interests is engaged and consulted in
the taxation reform process. Major reforms are not accepted universally supported, where
involving in defining problems & searching solution is likely to get more acceptance.
 Taxation performs number of function for the upliftment and development of society
economy. Taxes are charged as the individual and companies are using the resources of
country that belongs to all. It ensures income is equally distributed among the society.
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