Question

After reading Special Topic 1 and Special Topic 2, write a 2-page paper answering and describing: Can democracy survive if a majority of the citizenry pay little or nothing in taxes while benefiting directly from a higher level of government spending? Why or why not? Discuss

Answer 1

Can democracy survive if a majority of the citizenry pay little or nothing in taxes while benefiting directly from a higher level of government spending? Why or why not? Discuss

Ans: No, Democracy can not survive if a majority of the citizen pay little or nothing in taxes while benefiting directly from a level of government spending.

Why not ?

Actually before you explain the answer we have to understand the basic and fundamental things of Tax and its benefits to economy .

Actually the revenue budget is the combination of govt. revenue receipt and its expendture . The revenue budget is prepared by the revenue which is coming to the Government. The revenue is tax and non tax revenue. Tax is the majour sources of revnue in the democratic countries. There are so many sources of Government revenue and all are classified in to two broad categories one is tax revunue which is major impact to the economy of the country and other is non tax revunue which is alos helpful for the economic development. The sources are as follows

1. Tax

2. Rates

3. Fees

4. Licence Fee

5. Surplus of the public sector units

6. Fine and penalties

7. Gifts and grants

8. Printing of paper money

9. Borrowings.

The above 9 are the major sources of Govt reveune which are asically useful for Infrastrucre and social development of the country which is give a better lifestyle to the society or the economy , This revenue basically useful for some Defence, police, judiciary, Public Health , Infrastructure and any other sectors.

Out of the above 9 sources first two are coming under tax and rest are non tax revune.

Majority of the percentage it means more than 50% reveunes comes from collection of tax . This revenue gives more power to the economy of country and country use those money for Infrastructure developing, trade and so on to smothen the economic activities. This is direct relation with the government spending. If the govt. revune is increase the Govt spending also increase and vice versa. So in this startement we all better to understand how the revenue impact to govt. sepending.

More than 50% revenue are depends on taxes and if the citizens will not give the tax then there will be a major impact to the society or country developmental activities and which directly impact to the citizens of the country.

For example if we are not giving a single pay of tax the the governemt revue will be less because non tax and capital recepits contribute less than 40% which is not enough to mitigate country developmental activities and if the developmental acuitivites is not going well then people are also suffer in the public services.

In the Covid 19 time also govt. using their revenue for the public saftety and health measures which is free of cost and if the tax is not coming to the government then Economically weakly section people would not get facility in those lock down . It directly burden to the country because country borrow from MNC, world bank and other country with high interest rate which will be also major impact to the country as well as the public or citizen of country .