Question

What are some reasons it might be more difficult to collect revenue via a tax on financial capital, compared to a tax on property or a tax on labor? Can you draw a relevant graph to explain this question?

Answer 1

Yes It is true that collect revenue via a tax on financial capital is difficult for Govt. compare to collect tax on property or tax on Labor. A tax (from the Latin taxo) is a mandatory financial charge or some other type of levy imposed upon a taxpayer (an individual or other legal entity) by a governmental organization in order to fund various public expenditures.

A tax on a corporation's taxable capital, comprising capital stock, surpluses, indebtedness and reserves. Capital tax is applicable to capital owned by a company, not its spending. Capital taxes, in contrast to income taxes, are charged regardless of the profitability of the firm.
Also known as "corporation capital tax". Most countries have a tax system in place to pay for public/common/agreed national needs and government functions: some levy a flat percentage rate of taxation on personal annual income, some on a scale based on annual income amounts, and some countries impose almost no taxation at all, or a very low tax rate for a certain area of taxation. Some countries charge a tax both on corporate income and dividends; this is often referred to as double taxation as the individual shareholder(s) receiving this payment from the company will also be levied some tax on that personal income.

It is difficult to Coolect revenue via tax on Financial Capital as Financial capital is any economic resource measured in terms of money used by entrepreneurs and businesses to buy what they need to make their products or to provide their services to the sector of the economy upon which their operation is based, i.e. retail, corporate, investment banking, etc These funds are raised by company to invest in company and produce output

It is difficult to coolect revenue from it because

• Company raise this money from Investors
• Company use this fund to invest in company as a form of capital
• This fund is not a Income for company rather it is a liability
• Once company generate revenue with this fund company comes in position to pay Tax

At the same time Tax on Property or labor is easy as these assets generate revenu for the owner or individual out of these money they can able to give tax to govt. Like with property an individual can generate money as rental income etc similary with labor you can get salary or wags which is a direct income so it is easy to pay tax on that.