The history of Taxation in the United States can be traced back to the colonial period when the Americans protested against the policies on taxation that were put by Britain. In the 17th century tax were initially collected on imports and whiskey, .During the colonial period taxes were local. Later in the 18th century, tax was introduced on common products imported such as lead, tea, paper, good that were glass and paint. During the period of 1789 to 1914 tariffs were the chief source from which the government earned its revenue. Government in the Early 20th century, tax were levied on the good that were not from the local industry. This was in a bid to protect the local industries from failing because of cheaper import products. The taxes raised was also used to earn revenue for the government. Based on legal foundations other forms of tax were later introduced namely income, excise, property tax were introduced.
Describe Adam Smiths Cannons of taxation
Taxes are principal sources of government revenue. Everyone pays tax in one way of the other .They should therefor e be levied strategically to ensure that there are no unnecessary hardships that comes with it. Because of this Adams came up with 4 canons of taxation that the government should follow. These are canon of equity, certainty convenience and economy. Other canons suggested were Canons of productivity, elasticity, simplicity, diversity and desirability.
Describe the AICPAs guidelines for a fair system of taxation.
American Institute of CPA (AICPA) ensure that certain articulated standards of tax practice are adhered to by the all its members irrespective of the individual jurisdictions within which they practice. All members are to be in accordance with the AICPA Code of Professional Conduct. Some of the guidelines include advocacy and independence in tax practice, Internal revenue codes in which members should comply, specific procedures to require compliance. New competency requirement to address practitioners competence and members being free of conflicts of interest.
Describe a progressive tax system
This is a taxation system that varies based on the ability of the taxpayer. High income earning individuals or groups pay a larger percentage than low income individuals.
Describe a flat tax system
This is a system in which every taxpayer is levied tax at a similar rate, irrespective of the amount of income earned. Due to the parity in the tax rate deductions and exemptions are eliminated.
Describe seven types of taxes that are imposed upon citizens of United States
Income tax-This is the tax that is imposed on an individual by the government depending on their income or profits that they earn. It is obtained as a product of the taxation rate and the total income or profit. Jurisdiction on details of taxation vary.
Payroll tax- A tax that is levied against the salary of an employee.it is usually calculated as a percentage from the salary that is paid by their employers.
Property tax-This is tax based on propertys market value of a particular property owned. Most often levied on real estates but can also be levied on other properties such as cars.
Excise tax-These are tax levied on particular goods which usually bring about unhealthy behavior, for instance cigarettes and alcoholic drinks.
Sales tax-Tax that is levied on good or services that are purchased. It is worked out as a percentage of the price paid for the good.
Gift taxes-Tax paid on transfer of wealth form one person to another.
Estate tax-This is tax paid on the total net value of a person after his/her death before ownership is transferred to their heirs.
If you are the original author of this essay and no longer wish to have it published on the customtermpaperwriting.org website, please click below to request its removal:
- Paper Example on Effects of Oil Spill on Financial Performance of Amazon
- Native American Cultural Centre: Business Recommendation
- Essay on Digiteach: Non-Government Organization
- How Modern Technology Affect Accounting Work - Essay Sample
- Essay on Legislative Process for Drafting Federal Tax Law
- Research Paper Example on Customer Satisfaction in Islamic Banks
- Interpretation and Assessment of the Financial Performance and Position - Paper Example