AN OVERVIEW OF TAXATION

What is Fiscal Policy, Canons of Taxation >>

Taxation Management FIN 623

MODULE 1

LESSON 1.1

AN OVERVIEW OF TAXATION

Before moving on to Taxation Management, we must know what taxes are:

General Understanding of Tax:

Literal meanings ----- Burden, Strain

The long journey would be too much of a tax on my father's strength.

I found they were taxing my patience by asking irrelevant questions.

Such a long rough journey would be very taxing for old man.

General Definition of Tax:

General compulsory contributions of wealth levied upon persons by the state, to meet the expenses

incurred in providing common benefits upon the residents.

Statutory Definition of Tax

Tax means any tax imposed under chapter II includes a penalty, fee or other charge or any sum or

amount leviable or payable under this ordinance.

Taxes Vs Fees:

Taxes are compulsory levy and it is the legal obligation of the person to pay the amount of tax

which is required to pay under the law, where as payment of fee is the discretion of any person and

when a fee is paid, the person becomes an entitled to claim counter benefits.

Taxes are important instrument of Fiscal Policy.

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