Question

What factors might be considered when creating a tax that is considered fair by most people in a society? (LO3.1)

What are the ethical implications of not paying your fair share of taxes? (LO3.1)

What are some advantages of electronic filing? (LO3.3)

Answer 1

1: Factors which need to be considered when creating a tax in society are as follows

1. The tax rate should be such which encourages business activity rather than decreasing it.

2. Tax rates should be incremental so that higher income people are taxed more and the lower income people are taxed lesser.

3. A fair tax rate should encourage redistribution of wealth and support economy.

2: Not paying ones fair share of taxes is unethical since it does not allow redistribution of wealth in the society. It leads to lack of funds in the hands of the government which hinders the development of the economy. Taxes support the common sources in the economy such as parks libraries infrastructure and transportation. Retirement benefits also come from taxes and when one does not contribute to the taxes it would be unethical to reap the retirement benefits

3: The first advantage of electronic filing is that it leads towards a paperless society. It is easy and convenient and people can conduct the filing from the comfort of their homes. It saves the people the trouble of going to the income tax offices and standing in queues for completing their work.