What is taxation and why it is important?

What is taxation and why it is important?

taxation, imposition of compulsory levies on individuals or entities by governments. Taxes are levied in almost every country of the world, primarily to raise revenue for government expenditures, although they serve other purposes as well.

How do taxes influence responsible financial planning?

If the impact of taxes isn’t taken into consideration while making financial decisions throughout the year, you could be paying more in taxes than you would otherwise. Incorporating tax planning into your financial plan improves the probability of meeting your goals, especially when planning for retirement.

Why does the government need taxes quizlet?

Why does the government need taxes? For expenses and for your benefits like for social security and healthcare. Mandatory spending is social security and medicare. Discretionary spending is education and military.

What role does taxation play in the development of Nigeria?

Taxation as an instrument of fiscal policy, performs four economic roles for the development of a nation and state: (i) it helps to allocate resources from private to public needs (ii) taxation is very often used as part of the general public policy instrument to control inflation in a country, (iii) taxation can be …

Why is it important to understand tax laws?

Tax law helps to reduce errors when filing taxes. This is because they are deterring what is taxed, how it’s taxed, and to what extent it is taxed. Security. One of the most important parts of tax laws are that they provide businesses and individuals with a sense of security, especially when planning an annual budget.

Why do the biggest banks pay so little tax?

However, due to the use of offshore tax havens and various subsidies and loopholes, many of the biggest banks and corporations in the U.S. actually pay far less than the amount they otherwise would and in recent years both Citigroup and Bank of America had one or more years in which they paid no taxes.

How much will tax reform help the middle class?

Overall, the Joint Committee on Taxation estimates the law delivers taxpayers who earn $1 million or more a tax cut of $37 billion in the next year alone. “Our framework ensures that the benefits of tax reform go to the middle class, not to the highest earners.”

Are banks required to pay taxes on income?

Answer Wiki. Technically, Banks are required to pay taxes on income as are other corporations. However, due to the use of offshore tax havens and various subsidies and loopholes, many of the biggest banks and corporations in the U.S. actually pay far less than the amount they otherwise would and in recent years both Citigroup and Bank…

Which groups will get the biggest tax cuts?

But, measured as a percentage of their tax bills, the group getting the largest cut is clear: Families earning from $200,000 to $1 million will see their tax bills drop about 9 percent next year according to Congress’s official scorekeeper, the nonpartisan Joint Committee on Taxation.