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What happens if INCOME TAX replaced to EXPENDITURE TAX? |
What happens if INCOME TAX replaced to EXPENDITURE TAX? it will easy to locate and find thefts of tax An income tax is a tax levied on the financial income of persons, corporations or other legal entities. Various income tax systems exist, ranging from a flat tax to a progressive tax or graduated income tax system. A tax levied on the income of companies is often called a corporate tax, corporate income tax or corporation tax. Individual income taxes generally tax the total income of the individual (with some deductions permitted), while corporate income taxes often tax net income, the difference between gross receipts, expenses and additional writeoffs. A sales tax is a tax on consumption. It is normally a certain percentage that is added onto the price of a good or service that is purchased. Ideally a sales tax is charged exactly once on any one item. A conventional or retail sales tax attempts to achieve this by charging the tax only on retail transactions, not on businesses buying raw materials for production or finished goods for resale. This prevents so-called tax "cascading," in which an item is taxed more than once as it makes its way from production to final retail sale. A related type of tax is the value-added tax, or VAT. It is a system in which all businesses remit taxes on their sales, but they are also refunded the amount of VAT remitted by their suppliers. In addition to avoiding cascading, under VAT there is no need for government to determine which sales are taxable and which are not, since all sales--retail and wholesale--are taxed. Some states already do that. Income tax is levied on Income or surplus of an entity and the expenditure tax is levied with an intention of crubing or controlling expenditure., this has a different purpose and timing altogether., changing to expenditure tax in a development period (like we are now in India) will have an adverse effect of the economic growth. Because my expenditure is some bodies income., and you restrict me in my spending., you are indirectly restricting some others' income and thus effect the consuption power and there by economic growth. |
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