Write a response to the following: While no one likes to pay taxes they are nece

Question

Write a response to the following:

While no one likes to pay taxes they are necessary for most states to pay for their expenditures. In the United States, I believe that consumption taxes are the fairest type of taxes and property taxes are the least fair ones. The main reason consumption taxes are the most fair is because the person subject to the tax can control how much tax will be paid solely by limiting what purchases are made. In the case of property tax, however, it often seems like the government officials who determine what the tax should be make very arbitrary decisions.

Consumption taxes are the fairest type of taxes because people have control over how much they will pay in taxes. If an individual wishes to reduce the consumption tax owed, this can be accomplished by simply adjusting items that person purchases. Consumption taxes also have other benefits. The textbook discusses how Nicholas Kaldor believed that consumption is the best measure of whether a person can pay because a person’s ability to pay is best determined by his or her ability to earn income (Hyman, 2014). As Professor Hyman also notes in our textbook, an added value of consumption taxes is that they encourage people to save because taxes only apply to money that is spent (Hyman, 2014). While some people argue that consumption taxes can be unfair and regressive because they tax poor people on necessary products such as food, these products can be exempted to avoid this issue (Hyman, 2014).

Property taxes are least fair type of tax mainly because of how the tax is determined on a home or piece of property. The property tax is often used to fund educational services in many states and it is highly unlikely this tax will ever be done away with. People may be more willing to accept property taxes, however, if the process for determining them was less arbitrary. For example, in Fulton County, Georgia, the tax appraiser has come under heavy criticism the last few years for raising property taxes and not doing a good job explaining why the taxes have been raised so much for some people, but not others (Kass, 2018). In addition, it is very difficult to accurately appraise different properties located in the same neighborhood. This is because some houses may have been completely renovated, while others have had very little work done to them.

            Taxes are the most important method for governments to collect the revenue needed to pay for expenditures. While most people understand this is the case, consumption taxes are the fairest type of tax because the taxpayers control how much they will pay in tax. By comparison, property taxes are the least fair because often the system used to determine a property tax appraisal is confusing and arbitrary.

Explanation / Answer

taxpayer is a person or organization (such as a company) subject to a tax on income. Taxpayers have an Identification Number, a reference number issued by a government to its citizens.

The term taxpayer generally describes one who pays taxes. A taxpayer is an individual or entity that is obligated to make payments to municipal or government taxation agencies.[1] Taxes can exist in the form of income taxes and property taxes imposed on owners of real property (such as homes and vehicles), along with many other forms. Most adults are taxpayers. Virtually every human being is a taxpayer at some point. People pay taxes when they pay for goods and services, which are taxed. The term taxpayer often refers to the workforce of a country who pays for government projects through taxation. The taxpayers' money are part of the public funds, which are all money spent or invested by government to satisfy individual or collective needs or to create future benefits. For tax purposes, business entities are also taxpayers, which means their revenues and expenditures are subject to taxation.

Taxpayers' money help to pay for the items on the federal budget. The gap between revenue (money collected via taxes) and spending is known as the budget deficit. The money the federal government borrows to cover the budget deficit is what creates the national debt. The government spends money for a variety of reasons: reduce inequality (“safety net” programs), provide public goods (fire, police, national defence), provide important public services like education and health (merit goods), debt interest payments, transport and military spending.[2] The “safety net” programs are initiatives that give extra financial support to the elderly, unemployed, disabled and the poor. Examples include the earned income tax credit, child tax credits, unemployment insurance, food stamps, subsidized school meals, low-income housing assistance, energy assistance and more. The federal government spends its money in four major ways: direct payments, grants, contracts and insurance.

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