![]() The payee should be able to understand the concept and terminologies used and how the government comes up with such a figure. The principle of simplicityĪ good tax system should be designed in such a way that individuals should able to understand on when and where to pay the tax. If so, the government will have diverted from its primary objective. ![]() Therefore, the administrative cost of collecting the tax should not surpass the amount to be earned. The primary objective of taxation is to raise money for the government to finance its projects. When in Depression, the government may increase the amount of tax charged in order to raise maximum funds to finance its projects. When the government is in a boom economic cycle, the government should lower the amount of tax for other social benefits. The amount of tax charged should not be the same all year round. The principle of FlexibilityĪ good tax system should be flexible in order to meet the needs of the society. ![]() Those that earn a lot of money should be taxed based on the large income earned an individual who earns less amount of money should be tax proportional to the income earned. Individuals should be tasked based on the amount of income they earn. The government should exercise equity while designing a good tax system. ![]() Some of the principles of a good tax system include the following. Thus, this calls for the government to derive a good tax system to fix the needs of both the country and society. Plus, there are a lot of benefits of taxation which helps in improving a country economic system. Taxation is a source of revenue to Governments. ![]()
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