We use cookies to create the best experience for you. Keep on browsing if you are OK with that, or find out how to manage cookies.
Nobody downloaded yet

Taxation System of UK - Essay Example

Comments (0) Cite this document
According to Adam Smith there are four main principles or maxims of taxation - equity, certainty, convenience and efficiency. Equity refers to equality in the distribution of taxes so that every tax payer has the capacity to pay what he has been asked to pay…
Download paper
Taxation System of UK
Read TextPreview

Extract of sample
Taxation System of UK

Finally the system of collecting taxes must be efficient. For example if the government spends more in order to collect a given amount of tax money it is useless having a system of taxation. In the UK the current system of taxation has a number of shortcomings such as collective bias in favor of those who are able to pay and structural deficiencies at the deduction level.
The British system of taxation is basically determined by a desire to act in conformance with the age old principles of taxation as enunciated by Adam Smith. In the first instance taxes must be fair or equitable; secondly they must be convenient; thirdly they must be neutral; fourthly they must be efficient; fifthly they must be simple; and sixthly they must be adequate (Jones & Catanach, 2008). Yet how far these principles have been adhered to in the current situation in Britain is to be decided by each individual because there is much more to be desired in the British tax system with reference to the equity principle and the government's efforts to redistribute income on a nation-wide basis.
According to the first maxim of Adam Smith as noted above every person should pay in proportion to that which is based on their respective revenue earnings and to the extent to which they enjoy protection of the government. Simply it is the "ability to pay" principle. Further he shows that tax should be levied on economic rent because the rent and the revenue were considered as synonyms in Smith's days. However according to the tax system revenue includes only income from an investment and it excludes wages and salaries. Thus in the18th century Britain most of the income was earned from landed properties. In the 21st century Britain where services have come to occupy a very important place, the old approaches to taxation might not be feasible though the fundamental principles remain intact.
Secondly, tax payers must be certain about the current and future periods of time. Moreover, it must be predictable and should not be arbitrary. Each person should be aware about the exact amount that he/she has to pay according to their earnings. They should know reasons, exceptions/biases, and abatements when they are paying taxes. Government revenue budgets are either one year in duration or less (Ricardo, 2006). This affects businesses because they have to plan for corporate taxation a number of months, if not years, in advance. According to the third maxim, tax payment should be convenient to the tax payer. In fact the government should be flexible in the application of the tax rules. For example in demanding due payments, collecting payments and so on, tax authorities ought to identify more convenient ways so that the taxpayer isn't inconvenienced by way of haphazard schedules and rules as in the case of VAT financial penalty on late payers in Britain.
Finally, tax system should be efficient with reference to its determination cost and collection cost. Thus it ought to be as lower as possible. It is imperative that the cost of employing the tax officials should be less than the taxpayers' personal cost. However the British government has to spend a considerable amount of money on such things as maintaining records and form filling to collect taxes from people. ... Read More
Cite this document
  • APA
  • MLA
(“Taxation System of UK Essay Example | Topics and Well Written Essays - 2500 words”, n.d.)
Retrieved from https://studentshare.net/politics/283760-taxation-system-of-uk
(Taxation System of UK Essay Example | Topics and Well Written Essays - 2500 Words)
“Taxation System of UK Essay Example | Topics and Well Written Essays - 2500 Words”, n.d. https://studentshare.net/politics/283760-taxation-system-of-uk.
  • Cited: 0 times
Comments (0)
Click to create a comment
UK Taxation System

The author states that ordinary residence indicates a higher degree of permanence when compared to the residence. An individual is considered to be ordinarily resident if residence in the UK is of a habitual nature. Therefore, if that person goes abroad for a period constituting a full tax year the individual is regarded as remaining a resident.

11 Pages(2750 words)Essay
The U.K taxation system
This research aims to evaluate and present the comparison of the progressivity of incoming tax and corporation tax in the United Kingdom. The discussion will also attempt to address the primary question framed as follows: For income and corporation tax, identify who is responsible for notification of income and payment of tax and when? Has United Kingdom felt the need to respond to competitive pressures and how?
11 Pages(2750 words)Essay
Taxation in UK
The purpose of this research is to investigate the following: the importance of direct and indirect taxes; differences between direct tax and indirect tax; implications for direct and indirect taxes; progressivity of income tax and corporate tax in UK; tax revenues of UK government in the year 2010 – 2011; income and corporate tax realization and payment; tax competition.
12 Pages(3000 words)Essay
Evaluate the UK tax system in the context of Adam's Canon of Taxation
2008). This particular circumstance has led to occurrence and existence of gap between the profits stated for financial purposes and the amount of tax actually paid. There still exist no clear outline as to how extend this is an indicator of avoidance activity is actually tied up with the vexing question of what amounts to tax avoidance and the extent to which tax avoidance is undesirable and unacceptable in general (Wolfgang, et al.
8 Pages(2000 words)Essay
UK Taxation System Essay
All income is not taxable. Tax is applicable only for the income that exceeds the non taxable amount. However there are allowances and relief's which reduce the amount of net payable tax and in certain cases the person need not pay tax. Taxable incomes arises from earnings from employment/self employment, pension income from company, state and personal pensions, interest on savings, income from shares, income from trust and income from rent.
9 Pages(2250 words)Essay
UK Taxation: A Critical Review
2. If staff are engaged as employees, will careful use of ITEPA 2003 and especially 'Share Schemes' instead allow businesses to create flexible reward packages, which will better meet the business goals of (i) long term cost minimization and (ii) ensuring a stable and knowledgeable workforce
2 Pages(500 words)Essay
UK Taxation System
Also the structures of certain taxes are also explained in this essay. Apart from this, some figure with respect to the contribution of the different taxes to the total revenue raised are also indicated wherever necessary. All the figures and different information quoted in this paper are extracted from the survey conducted by the Institute for Fiscal Studies on the UK Tax System for the fiscal year 2006-2007.
9 Pages(2250 words)Essay
UK Taxation
As an alternative to the comprehensive tax system, the expenditure tax system taxes an individual on the amounts of his total receipts minus the amounts spent on his purchases,
8 Pages(2000 words)Essay
Adam Smith & UK Income Taxation
639). The first edition of Smith’s book, “The Wealth of Nations,” was written in 1776. This discussion utilized the third edition dated 1784. Adam Smith lived from 1723 to 1790 (Ekelund and Hebert 1997, p. 97; Landreth
18 Pages(4500 words)Essay
She thought of amending the transportation tax system and wanted to bring a proposal for adding ‘1p per mile’ to all transports in order to pay for the purpose of improvement in United Kingdom. The proposal is of increment in the tax rate of 1 p per
4 Pages(1000 words)Essay
Let us find you another Essay on topic Taxation System of UK for FREE!
Contact us:
Contact Us Now
FREE Mobile Apps:
  • About StudentShare
  • Testimonials
  • FAQ
  • Blog
  • Free Essays
  • New Essays
  • Essays
  • The Newest Essay Topics
  • Index samples by all dates
Join us:
Contact Us