Taxation Essay Example | Topics and Well Written Essays - 1500 words

receipts - Essay ExampleIn implementing the principles of taxation efficiency, it adheres to fiscal neutrality in the sense that the tax dodge is implemented such that it does not interfere with the workings of the markets or the decisions of the households while minimising the disincentive effects of regimen taxes on he level of economic activity. Subscribing to the perspective of the OECD that an efficient tax system is achieved via a intermix of different taxes, the UK tax system combines various types of taxation to promote taxation efficiency (UK sevens, 2011). Another beta policy anchor on which the UK taxation system rests is fairness. According to the UK Parliament (2011), this bastardlys that the burden of tax should reflect the ability to pay while incorporating principles of intergenerational equity. A defensible way of interpreting the policy contract bridge is that the UKs tax policy is governed by equity taxation which can be extended to guess that taxation ca n be used to promote equity. The UKs notion of equity, however, covers the promotion of social and intergenerational equity. This mover that equity across social groups is promoted (without promoting disincentive to work and do business) as well as intergenerational equity. ... It is a standard notion in economics that horizontal equity means that those who earn the same should live with equal burden of the tax while vertical equity means that those who earn more should division a high burden of the tax those with the same ability should pay the same tax and those with higher abilities should pay more taxes. The UK Parliament (2011) also emphasised that in promoting fairness in taxation requires that the UK governing body activity create policy measures that prevent tax avoidance and evasion. Finally, another important reason given by the UK Parliament on why the government of the UK imposes taxes is that people must get value for their money. This is construe to mean that th e UK taxation is designed and people are taxed in a means that compliance and collection cost are marshalled to a minimum (UK Parliament, 2011). In sum, based on the UK Parliaments publication, the core principles of the UK governments tax policy are sustainability, efficiency, fairness and value for money. The four principles provide the basis as well as the reasons on why a certain tax policy is adopted and the manner by which a tax policy is implemented. At the same time, the articulation of the four principles should not conceal a fundamental fact the main aim of the tax system of the UK is to raise revenue (UK Parliament, 2011). The UK Parliament (2011) publication declared that if tax policy is used to support other objectives then it should be interpreted as an attempt by the tax system to produce the best value for money. With the ongoing world(a) economic difficulties that are believed to have originated from the United States sub-prime crisis of 2008, UKs taxation polici es are also