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Taxation

Taxation is the charges that governments place on individuals or corporations to finance their expenditure. Taxation plays a significant role in how public finance is conducted today. The main goal of taxation is to increase revenue and it is used as a way to redistribute wealth within an economy to reduce the divergence between the rich and poor. One of the main purposes of taxation is for the government to provide funds in order to increase public welfare and provide society members with more economic freedom. Another purpose of taxation is to control the economy in order to prevent inflation or depression, reduce inequalities in wealth, and protect local industries.

There are different types of taxes that are separated into direct tax and indirect tax. Direct taxation are based on the income of the wage earner while indirect taxation can be avoided because as an example, it can be sales tax placed on goods or services. The types of taxes include sales tax, which is tax on the sale of goods and services; duties, the taxes on importation; excise tax, tax on production of goods; and personal income tax.

The marginal rate of tax (MRT) is the percentage of tax taken from an extra dollar earned/spent. Proportional taxation is when marginal rate of tax equals the average rate of tax. The proportion of tax paid increases with a higher income but will stay the same as long as income does. Progressive taxation is when marginal rate of tax is greater than the average rate of tax. This means that a larger portion of tax will be taken out of the income of higher income earners while lower income earners have a smaller proportion of tax taken out. Converesely we have regressive taxation which not often practiced because it increases the separation between higher income earners and low income earners.

Conserving Working Capital

Leasing capital equipment is one of two ways for companies to conserve working capital. Explain why it might or might not make sense for a medium-sized corporation attempting to grow its business.

Impact of charitable donations on taxable income

George and Margaret Wealthy are in the 48 percent tax bracket, considering both federal and state personal taxes. Norman Briggs, the CEO of Community General Hospital, has been aggressively pursuing the couple to contribute $500,000 to the hospital's soon to be built Cancer Care Center. Without the contribution, the Wealthy's ta

Taxing Corporations

a. Many citizens who believe that the rich should pay more in taxes argue that the taxes levied on corporations should increase. Is it likely that increased taxes on corporations will increase taxes paid by the rich? In your answer make sure you consider all possibilities for the incidence of the tax and make your assumptions ex

Public Finance and Taxes

1. The increased suburbanization of urban population was an important social phenomenon of the 1960s and 1970s in metropolitan areas in the United States. Explain how the decision to migrate to another jurisdiction in a metropolitan area is influenced by policies of central city and suburban government policies. What steps could

Selecting a method of taxation

Explain the benefit principle for selecting a method of taxation. Is the benefit principle more likely to be followed if a tax structure is regressive, proportional, or progressive? Create and clearly provide an example of an actual tax to illustrate your answer.

Proposition 13

California"s Proposition 13, enacted in 1978, limits the property tax on real estate to one percent of the market value when purchased, and a maxium annual increase in the tax amount of 2 percent. Followers of Henry George contend that Prop 13 deprived local governemtn of this most suitable tac base, real estate tax and forced

Policy Principles: Using Revenue from Taxes on Guns/Ammunition

Based on grounds of utility and other distributional goals, argue why it is okay for states to use the revenue from taxes on guns and ammunition to spend on public welfare programs and to preserve natural habitats. Apply policy principles in this discussion.

Lorenz Curve: Distribution of Wealth in the United States

Construct an income distribution diagram using the Lorenz Curve for the U.S. with the latest data available. Describe the extent of inequality depicted in your diagram? Describe how you would reduce the inequality using vertical equity taxation? Using horizontal taxation?

Negative Externalities and Urban Travel

A city can subsidize commuting via public transit by giving public funds to buses and subways. A city also subsidizes commuting by car by spending public funds to maintain roads and bridges. How are total negative externalities affected by the public funding of buses and subways? How are negative externalities affected by public

Nonexcludable goods and private goods

Unlike private goods, pubic goods are goods that are nonrival in consumption and/or their benefits are nonexcludable. When a good is nonexcludable, individuals can obtain the benefits of the good without paying for it (free riders). So, it appears that the existence of public goods is an example of potential market failure. Writ

Transfer Pricing by Multinational Companies (MNC)

Discuss the use of transfer pricing by multinational companies (MNC). How might this be used by a MNC when the host country (let's say the USA) has currency devaluations? How might this be used to avoid/delay taxation? Please use a subsidiary in a specific country as part of this discussion.

Internet Tax

Various politicians and the United Nations have proposed an Internet tax. One proposal would be to tax both outgoing e-mails and every Web page that is downloaded. What would be the problems with such taxation for (a) individuals, (b) students, (c) online companies, (d) entrepreneurship/small businesses? Who should get the tax m

Economic question are posed about a less-developed nation in Africa.

Question: Suppose you were appointed economic advisor to a less-developed nation in Africa. The nation is seeking to encourage capital formation and wants to increase the rate of savings of its own residents and encourage foreigners to invest in their nation. What role would you assign to property taxes in this nation to

Economics question

The traditional U.S. auto industry (the Big Three) has struggled for many years against competition from foreign-owned automobile companies. Their struggle was dramatically heightened in 2008 with the world-wide credit crunch and economic slowdown. Automakers came to Washington in late 2008 asking for Federal financial aid to

Market Failure in the Private Provision of Jails

Most prisons are publicly owned, but Ontario opened a private prison at Penetanguishene in 2001, whereby the government pays fees to the contractor based on the number of prisoners held. Discuss whether there is potential market failure in the private provision of jails.

Calculating this year's GDP

1. Suppose the value of the French Franc in terms of the dollar is: 50 on October 12 , and 44 on October 17 . By how much has the Franc appreciated or depreciated against the dollar? The value of the Franc rises against dollar by 12 The Franc has actually depreciated by 12%. The Franc has remained c

Trade Deficit

What have been some major causes of the large U.S. trade deficits since 1992? What is a major benefit (you could address that issue) or a major cost (or, you could address that issue) associated with trade deficits?

Macro Model and Fiscal Policy Internet

Please give a detail explination. Include any graphs or charts as needed. Internet Question http://taxhistory.tax.org Go explore the tax museum. While there select the dates 1861 to 1865. Provide a synopsis on the relative approaches taken by the North and the South with regard to tax policy. Which was superior and why?

Depreciation for Taxable Income

1. The MacCauley Company has sales of $200 million and total expenses (excluding depreciation) of $130 million. Straight-line depreciation on the companyâ??s assets is $15 million, and the maximum accelerated depreciation allowed by law is $25 million. Assume that all taxable income is taxed at 40 percent. Assume also that net

Elasticity of Demand

Consider this: You are chairperson of a state tax commission responsible for establishing a program to raise new revenue through excise taxes. In your own words please give a detailed explanation as to why would elasticity of demand be important to you in determining the products on which the taxes should be levied? Plea

Pure, Per Se and Natural Monopolies

Assignment Type: Deliverable Length: 2 Policies Sometimes market activities (production, buying, and selling) have unintended positive or negative effects outside the market's scope. These are called externalities. As a policy maker concerned with correcting the effects of gases and particulates emitted by and local com

Taxes and the Multiplier Model

Please help. I need detailed information on the following: If taxes are lowered how will it affect the multiplier, AD, GDP, prices and tax revenue? Also, how are taxes incorporated into the multiplier? (I am not sure what the word "incorporated" is referring to and cannot seem to get a straight answer.) I have already

Fiscal Policy

1. According to Keynes, if aggregate demand is too high and an inflationary gap is beginning to develop in the economy, fiscal policy should be contractionary. True False 3. The elimination of automatic stabilizers would most likely increase the need for more fiscal policy prescriptio

Help with countercyclical fiscal policy

A. What are the advantages of the Fed increasing interest rates when the GDP gap is positive? b. What are the disadvantages of the Fed increasing interest rates when it believes the GDP gap is positive? c. List and describe the two types of countercyclical fiscal policy.

Economics

9. What's wrong with the following statement? People should be taxed in proportion to the economic benefits they individually receive from spending the tax revenue; therefore, estate taxes should be eliminated, and welfare programs for poverty should be financed by taxing the poor.

conditions that undermine independence

For each scenario below, describe which of the five general conditions that undermine independence in appearance is most relevant, a. An auditor recommends its audit clients' services to other clients based on her understanding of the quality of such services. b. A partner serves an audit client even though her grandmother h