Should Australia Introduce Any Tax Or Gst Changes? :: essays research papers

Why do we need tax incomees?Taxation makes up majority of our establishments income. With this income the government can provide us with proper infrastructure and social services for little, if no cost at all. These include Medicare, social security and education. (These facilities are known as recurrent expenditures because it is needed time after time.) Other expenditures include transportation, lighting, recreation etc. These services are granted to us at no costs. In many tertiary world countries where taxation is low or doesnt exist, all of these services are to come out of ones own pocket. Over the many centuries, in which taxation was existent, pot have cheated and avoided paying these taxes. Nowadays people with high-income put their money into trusts, superannuation, or incorporate it into businesses. Businesses would try and receive more cash transactions. This has led to a strike in our governments revenues, thus leading to a tax reform in hope of a more effective re sult. What makes a good tax trunk?There are four elements in a successful tax system. They are effectiveness, efficiency, equitability, and simplicity. 1) Effectiveness is the performance compared to the desired effect. E.g. the number of people who pays tax, how much tax is received.2) Efficiency is the cost of running the system. The system may be very effective with a million tax officers, but it would cost millions to hire so many people. 3) Equitability is the fairness of the system. This is an impossible goal to achieve. From different peoples point of views, the system will always be unfair to them in some way. Not to note the tax cheats. The best solution is to broaden the number of people who pay the tax, which is only fair. 4) Simplicity A tax system should never be alike complexed, it is otherwise not streamlined neither understandable. The income tax Act that just started off at just 120 pages in 1936 is now over 3300 pages and has three-fold in size over the last 7 years. A complex system means that those who can afford expensive tax advice minimize their tax. only when those that cant, pay the full share. It is impossible to have a system where all four elements are satisfactory. Where a system may be effective and efficient it will not be equitable or simple. It is impossible to fit the whole population all under one roof. Under these circumstances the government proposed a new way of taxation- GST.