NOTE2B

Question 1

Objective of taxes

Answer 1

Provision of public goods
Redistribution of income and wealth
Promotion of social and economic welfare
Economic stability
Revenue generation
Regulation
Protection
Resource allocation

Question 1

Principles of tax

Answer 1

-flexibility
-equity
-efficiency
-certainity
-convenience
-neutral
-adequat revenue yield

Question 2

Categories of revenue

Answer 2

-Taxes: compulsory impositions
-Charges (Licences and fees): voluntary transactions
-Borrowing: external and domestic: voluntary transactions

Question 3

classification of tax

Answer 3

BY TAX BASE (i.e what is being taxed): -Income: Income tax, Corporation tax
-Capital: Capital gains tax, Inheritance tax
-Consumption: Value added tax, Excise duties
BY TAX SUBJECT -Direct: Income tax, Corporation tax, Capital gains tax, Inheritance tax
-Indirect: Value added tax, Sales tax
BY DISTRIBUTION OF TAX BURDEN -progressive tax
-proportional tax
-regressive tax