Tax Fairness Model

Tax Fairness: Tax fairness as perceived by prior literatures could either be vertical or horizontal fairness. According to Erich, Niemirowski & Wearing (2006) vertical tax fairness is when taxpayers’ are being treated or taxed with different rate based on their different business activities. On the other hand, horizontal tax fairness is the instance where taxpayers’ are being treated equally in terms of their taxes (Michael, 1978). Horizontal tax fairness indicates that taxpayers’ that are into same business activities and earned same income should probably pay same taxes. Mukasa (2011) found that improved tax fairness would lead to the enhancement of compliance behaviour.

Advantage of flat tax system Before we start to discuss the content in this part, some conceptual issues should be illustrated ahead of the very beginning of this part: What’s the spirit a tax system should convey to the public? What are the functions and goals the government plans to achieve through a tax system? The spirit a tax system should convey to the public. All men are created equally which convey the basic creed that everyone should be equally considered despite the race, color, faith and- which should be specifically focused in this case- income. Everyone should be treated equally under the tax system which actually represents the spirit of fairness.

Regressive taxes are taxes that are the same for all individuals, regardless of income or other monetary values. Examples of such taxes would be gas, food, and other consumer goods. Taxes of these kind are known to reflect greater grievances to the poor than wealthier individuals. A better form of taxation that better benefits low-income individuals are known as progressive taxes. A progressive tax is a tax that is based on income which is why it is considered more favorable for the poor.

Furthermore, with reference to academic literature from Beattice, Goodacre and Thomas enlightened the readers of the similarities in terms of gearing ratio, which both theorist is similar and consistent but differences occur in with the trade-off with tax shield and pecking order with the new issue of shares (McLaney, 2009). Nevertheless, the contrast between the two theorist is the Trade – Off theory argues the effective measure of tax shield for corporations for the business to be successful whilst Pecking Order theory debates that with equity the business can be effective and efficient when allowance is made for the issue of new shares. Prevalently in this matter, when shares are purchased this is an avenue for investment but on the order hand trade-off is against the allowance of new shares and avoids the trade-off of new share issues (Corporate, Finance,

Pros and Cons of the Fair Tax Act If you've experienced filing and paying taxes taxes, you know how confusing and how much of a hassle it can be. Many people don't only complain about the complex process, they also express that wealthy persons and families, businesses, and special interest groups pay less tax than they're supposed to due to certain exemptions and loopholes. Because of these frustrations, the Fair Tax Act is gaining a strong following. This plan aims to replace the federal tax income system with a flat national sales tax. Supporters of the plan believe this would help to evenly spread the tax burden, get rid of loopholes, and take away the hassle of collecting taxes without affecting federal tax revenues.

The main aim of the thesis is the analysis of libertarian paternalism on the example of the UK's tax system. Another aim is to find out if the «nudge» approach is effective in the context of tax system. This thesis aims to find out if the implementation of Nudge theory courses any results and how it changes tax system from the side of government and the side of citizen. This thesis hypothesizes that implementation of libertarian paternalism approach in the UK's tax system leads to increase in tax compliance. The reports of the UK Government and also the scientific sources are used to answer the following question: What are the impacts of implementation of the Nudge Theory into UK’s tax system?

Equity denotes proportionality: when the outcomes are proportional to inputs it is considered fair. The outcomes that is divided uniformly between the beneficiaries is called the Equality principle. In order to approach the principle of necessity it is important that the distribution is based on the needs of the recipients (Fondacaro, Jackson, & Luescher, 2002). Distributive fairness is somehow linked to cooperation between the individuals of a society (Tyler & Blader, 2003). In societies, justice is of paramount importance because it affects people disposition to collaborate with others (Tyler,

For example, some of the principles are rule of law, individuals rights and freedoms, private property, economic freedom,self interest and competition. Modern liberalism emerged from the idea of having the government increase its role in striving to provide the protection of individuals rights, an increase in government intervention in the economy, education, healthcare and welfare. Therefore, economic equality is a principle in which individuals in a society are equal and have an equal access to all of the financial opportunities in order, to be successful. Hence, the government also strives to achieve economic equality by implementing progressive taxation in order, to redistribute wealth and resources in order, to help out the less wealthier communities. However, laissez faire is a belief that supports the idea of acting in an individual 's own self-interest, competition and owning private property.

As the results (Appendix 1) shows, leverage and PB ratio have positive relationship with dividend payout ratio, while, risk, growth, profitability and size have negative relationship with dividend payout ratio. According to the results, banks can adjust the dividends declared corresponding to its situations. The project also introduces the relationship between the dividends and information-sensitive depositors (Appendix 2). These all are helpful for banks to make dividends decision and find the optimal payout ratio for the development. 2.

Broad topic. The welfare state is a governing system where a state plays an important role, in order to provide economic prosperity, prosperousness, security to its citizens, based on the concept of equality. Citizens get benefits from welfare services like education, healthcare, support for the needy, social security Many economists can argue about state intervention, sometimes, higher taxes, because of welfare state. But the most important thing to recognize positive benefits of welfare state, like universal access to public goods: access to healthcare, decreases disease and increases public health, access to education, provides knowledge to everyone regardless of their social status. One of the top debated injustices of laissez faire