Question

licenses provide a means of regulating and taxing certain businesses.

- true

- false

Answer 1

Yes it is true that licenses provide a means of regulating and taxing certain businesses.

For the purpose of earning, people usually indulge in business which are illegal or earn huge by exploiting customers in many ways. Also there are business which require license without which a particular business cannot be regulated. This is because licenses gives a person right to run a business legally and hence the person will have a fear that doing any illegal activity can cause him to pay huge tax or may also result in seizing of his business.

It is important to license certain business for the benefit of the society. Government should take strict actions against the the who are not following this and should be charged high tax for running business without license.

So here we saw how license regulate certain businesses and why license is important for running certain businesses.

Now coming to license as a means of taxing certain businesses, then it can be understood as the business that require license to run, has fixed period after which the license needs to be renewed otherwise that license will expire and would not be considered further.

If a business does not renews his license, it can be charger for this and has to pay huge tax as penalty for not renewing the license. Hence this leads to taxing the businesses. Its important to renew the license as time to time policies change, there is a need to bring change in economic conditions and accordingly policies also change and every running business should follow the updated rules regarding any business for the betterment of the nation. Hence taxing business if license is not updated, must be followed.

Also the business which are running without license are charged with huge tax or their business is brought to closing as being illegally run.

Hence, we saw how license is a means of regulating and taxing certain businesses which is required.