The government would tend to relying on borrowing from other foreign country when they faced a budget deficit. The crowding out effect started which would cause a huge burden to the country that is government did not allocate enough money for public goods and services, which will influence the economic growth. The country will have a wider deficit and higher debt pressure. (Ingram, n.d.) In conclusion, should the federal budget always be balanced? To sum up all the points above, I would to say that the federal budget should always be balanced, based on the many advantages that have been discussed above.
Is it ethical and rational to tax more on rich? Why must the rich pay more tax to help the poor? Although taxing more on rich seems unfair for the rich, it is necessary that rich people should pay more tax and the amount they pay are based on their incomes. First of all, the important reason that can be presented is that the rich people have utilized the public system more. As Elizabeth Warren said, "There is nobody in this country who got rich on his own.
Many thinkers believe that VAT spread globally because it is the consumption tax best suited to the revenue needs of states in an increasingly globalised economy. Even those who recognize the role of key regional and international institutions in promoting VAT often attribute the motives behind the promotion to the merit of the policy instrument itself. The rise of popularity of VAT is attributed to such virtue as the tax being the best method taxing general consumption, its neural treatment of exports, and its revenue raising capacity (Consumption Tax Trends, 2008). VAT are especially well designed to avoid taxing business input, since each component of a retail product’s value added is taxed exactly once. In other worlds, many countries replaced their poorly structured sales taxes with a better-functioning salestax.Some experts are of the view that the rationale for adopting a VAT was quite different; the VAT was adopted to replace the corporate income tax not the sales tax.
The answer will be NO. Ideally the rates should be in slabs for savings and investment because government cant charge same tax from the person saving in thousands and crores. So there should be slabs and these slabs should be created in a way that lowest slab is lower than that of rate on consumption and highest slab is higher than consumption tax. This will suffice both financial equality and also encourage savings. CAN CONSUMPTION TAXES BE MADE
Saving the American Dream When the United States was founded, the American dream was a dream where hard working people could be financially profitable, and set their children up to hopefully, better off. This dream, although seeming achievable then, has slowly gotten out of reach from most American people. So, what is the American dream now? The American dream is to rebuild the middle class in a way that anyone, no matter their age, background, ethnicity, etc. can achieve the absolute best according to their abilities and by mending the distance between the ordinary man and the rich by changing the focus of the government from the wealthy to the middle class, we can inspire The easiest way to give everyone an equal opportunity to succeed
These policies provide strict guidelines that must be met in terms of taxation. The United States’ tax system that is most concerning when it comes to income inequality is income tax because this is directly deducted from the citizen’s paycheck. However, this same policy is not enforced in the Cayman Islands. The Cayman Islands are known for their tax neutral jurisdiction as no one, rich or poor, pays income or corporation tax. And according to the Atlas of global development, the Cayman Islands have a higher quality of life than the United States - this is proven by the fact that the Islands actually provide homes and jobs for more expats than the united states, in terms of their
Participatory budgeting can be enhanced by increasing an interest in open budgets. Participatory budgeting go well with broad range of initiatives that are to strengthen citizen’s participation in government accountability. (Carlitz, 2011) Government revenue policies can also influence lower and middle-income countries to have expanded public understanding when it comes to revenue issues. Issues of corruption can also be limited by increasing monitoring of budgets. Further explains that there should not be one person responsible for monitoring and enforcing the budget because they can be corruptive themselves.
It is highly likely that there will be disincentive effect, discouraging the workers from working hard (Economics Help). Since the workers are aware of the fact that a huge proportion of their income will be taken away anyway, there will be less incentive for them to work hard. Also, such progressive tax can discourage the poor from struggling to climb the ladder. The mere fact that they will be provided with insurance and protection from the government will eliminate the need to get out of their current status. Nonetheless, other economists argue that the disincentive effect is highly unlikely to occur.
Taxing the wealth is an important aspect of modern democracy, especially at times like cutting welfare and increasing taxes on the middle earners. The OCED state that a wealth tax levy on the rich individuals could be very successful and should be compared with personal income tax in assessing the progressiveness od a tax regime. Wealth taxes will be paid out of income in order to address ability to pay concerns, a ceiling provision is usually included in net wealth tax legislation which states a maximum combined effective rate for income tax and wealth tax. In the long term a well-designed wealth transfer tax is likely to be more effective than a recurrent net wealth tax at reducing inequality in the distribution of wealth. This is because taxes on generation wealth transfers target and reduce the array of individual’s initial wealth
The advantages of indirect tax such as, person not possible to evade indirect tax because the collection takes place automatically when goods are bought and sold. Secondly, the indirect tax more convenient because they are wrapped in prices. The consumer often does not know that he is paying tax. Another advantage of tax is that every member of society contributes something towards revenue of state. Next, Indirect tax is also elastic to a certain extent; the state can increase its revenue within limits by increasing rates of taxes.