Essence and nature of taxes, Principles of taxation - Economic theory

The nature and nature of taxes

The main source of public spending coverage is taxes, the nature and nature of which are disclosed in various models of building tax systems, or tax theories. Economists distinguish the following tax theories: a) general, which reflect the purpose of taxation in general; b) private, investigating individual issues of taxation.

L. The general theories of taxes are:

• Exchange theory (Middle Ages). The contractual relationship between government authorities and citizens regarding the "purchase" the last military, legal protection from the state (tax - a measure of barter for services);

• Atomic theory (the Enlightenment era, Vauban, SHL Montesquieu, Voltaire, Mirabeau). In exchange for paying taxes, a citizen receives from the state services to protect his property and personal safety from both external enemies and enemies inside the country. This transaction is compulsory and not always fair;

• The theory of pleasure (first half of the XIX century, J. Sismond de Sismondi). Under the pleasure of understanding the order in society, the possession of property, the presence of justice, good roads, healthy water. These pleasures can be bought from the state through taxes;

• Insurance theory (second half of the XIX century, J. McCulloch, A. Thierry, E. de Girardin). The tax is equivalent to payment of the insurance premium. A taxpayer insures his property against various kinds of emergency situations in proportion to his income or property;

• classical theory (the turn of the XVIII-XIX centuries, A. Smith, D. Ricardo). Taxes are one of the types of government revenues that must cover the costs of maintaining the state, not all, but only the costs of public defense and the maintenance of the dignity of the supreme power;

• The theory of the victim (XIX - the beginning of the XX century, N. Canar, B. G. Milgausen, S. Yu. Witte, J. Targulov). People suffer privations, paying large amounts of taxes to the state, i. they make a sacrifice. The state, being a compulsory body, predetermines the nature of the tax as a necessary donation. The tax is a form of state income, which is a victim of citizens to meet the needs of society;

• The theory of social needs (late XIX - early XX century, L. Stein, A. Scheffle, F. Nitti, E. Sachs). The state is called upon to fulfill economic functions. Covering this kind of expenses are called taxes. Taxes are not a loss of the company, but are a fee for public indivisible services.

B. Private tax theories include:

• The theory of the ratio of direct and indirect taxation. In the second half of the XIX century. scientists came to the conclusion that it is possible to build such a system only by combining in practice both forms of taxation, but with the predominance of its direct forms as the most fair (income taxation);

• The theory of a single tax. Taxes must be paid from one source - from income. Theoretically, the collection of a single tax is more expedient, simple and rational than levying a multitude of individual taxes. However, the practice of taxation in various countries has repeatedly proved the idealism of this approach;

• Theory of proportional taxation. Weakening of tax pressure as the object of taxation increases (taxable amounts). Supporters of this method of taxation are always the most powerful classes;

• The theory of progressive taxation. Strengthening the tax burden as income and property status of the payer increase. It is believed that a rich citizen should be taxed with great tax - not only absolutely, but also relatively;

• Theory of the transfer of taxes. Studying the fairness of the distribution of the tax burden, depending on the forms of taxation, the elasticity of demand and supply. Studies are conducted by sources of income and by categories of payers.

As the theories of taxation arose and developed, the concept of "tax" was evolving. Scientists and public figures constantly made attempts to define the tax as an economic category.

Tax - is the burden imposed by the state in the legislative order, which provides for its size and payment procedure (A. Smith). The Scottish economist puts forward the thesis about the unproductive nature of public spending, therefore he considers the tax to be harmful to society. On the other hand, tax is a conscious necessity, the need for economic and social development. In these statements, the dual nature of taxation is traced.

The tax - is a victim and at the same time a blessing if the services of the state at the expense of this victim are of benefit (J. Sismond de Sismondi).

Tax - is a compulsory payment to the government of a household or a money company (or the transfer of goods and services) in exchange for which a household or firm does not receive goods or services directly (K McConnell and S. Bru).

Taxes - are compulsory levies collected from the population in a certain territory on statutory grounds, in order to cover the general needs of the state (Soviet financial encyclopaedia).

Principles of taxation

In the tax sphere, basic ideas and provisions are applied, which are called principles of taxation. The economic principles of taxation were first formulated by A. Smith. At present, they have undergone some changes and can be briefly described as follows.

1. Equity principle: everyone should take part in financing the state's expenses in proportion to their incomes and opportunities. The methodological basis is progressive taxation: who gets more benefits from the state, he must pay more taxes.

2. The principle of proportionality: it means the balance of the interests of the taxpayer and the state budget. This principle is characterized by the Laffer curve showing the dependence of the tax base on changes in tax rates, as well as the dependence of budget revenues on the tax burden.

3. The principle of accounting for the interests of taxpayers: it means the simplicity of calculating and paying taxes. This principle is disclosed through:

a) the principle of certainty - the amount, method and time of payment must be accurately known to the taxpayer;

b) convenience principle - the tax is levied at such a time and in such a way that are most convenient for the payer.

4. The principle of efficiency (efficiency): it means the need to reduce the costs of the state from levying taxes. The amount of charges for an individual tax should exceed (and approximately two times) the cost of its maintenance.

Over time, to this list, the Austrian economist Adolf Wagner (1835-1917) added the following principles:

• sufficiency (ensuring the coverage of state expenditures by tax revenues in this and subsequent periods);

• the right choice of sources of taxation;

• Identify ways to get rid of taxes (meaning legal);

• the impact of taxes on payers

• community (coverage of all layers of the population by taxation);

• Progressiveness (an increase in the amount of tax with an increase in the payer's income);

• exemption from taxes of a part of the population receiving minimum income.

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