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Explain five principles that guide the tax system in a country.

      

Explain five principles that guide the tax system in a country.

  

Answers


kinyua
i) Equity - the tax should be charged according to ability to pay.
ii) Certainty - the tax to be paid should be clearly defined/the tax payer should be informed about
the rate of the tax/time of payment/amount to pay/etc.
iii) Convenience - collection/payment of tax should not be cumbersome/mode of
payment/collection should be comfortable to tax payer/collector.
iv) Economy - administration cost of the tax should not exceed revenue from the tax/lower cost of
collection compared to amount collected (from the tax).
v) Flexibility - it should be possible to revise/vary/change/adjust the tax easily to be in line with
changing economic situations/prevailing conditions.
vi) Diversity - there should be a wide variety of taxes applied to yield enough/sufficient
revenue/cover entire (taxable) population/suit different tax payers/ensure equity.
vii) Elasticity - the tax revenue/collected should be able to respond to changes in national
income/realize more income when economy is booming.
viii) Simplicity - (tax system) should be easy to understand/know how it works/easy to apply.
ix) Not oppressive - the tax should not be too high as to discourage (hard) work.
monica20 answered the question on November 11, 2017 at 11:11


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