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What is your understanding of various revenue sources at each level of government ? Describe how...

What is your understanding of various revenue sources at each level of government ?

Describe how the concept of tax equity applies to income, payroll, and wealth-based taxes vs. transaction-based taxes.

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A tax is a compulsory levy imposed by a public authority against which tax payers cannot claim anything. It is not imposed as a penalty for only legal offence. The essence of a tax, as distinguished from other charges by the government, is the absence of a direct quid pro quo.  A licence fee is paid in those instances in which the Govern­ment authority is invoked simply to confer a permission or a privilege. The government acts like a business- person and the public acts like its customers. The government may either sell goods or render services like train, city bus, electricity, transport, posts and telegraphs, water supply, etc. The government also earns revenue from the production of commodities like steel, oil, life-saving drugs, etc. Fines and penalties They are the charges imposed on persons as a punishment for contravention of a law. The main purpose of these is not to raise revenue from the public but to force them to follow law and order of the country. Printing paper money is another source of revenue of the Govern­ment . It is a method of creating extra resources.

A transaction tax is not a levy on financial institutions per se, rather, it is charged only on the specific transactions that are designated as taxable. So if an institution never carries out the taxable transaction, then it will never be subject to the transaction tax whereas wealth tax is levied on total value of personal asset including bank deposit etc. and the tax chargeable on income of a particular person beyond the exempted limit is a tax levied from their income may be from any source, and payroll taxes are the taxes levied for the services rendered as a professional to any organisation by his personal capacity.

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