The role of government in society

One should ask, what is the role of government in today's modern society? In my eyes the role of the government must be limited, and there should be no room for self-enrichment, since we must assume that these people are in government because of their love for the people and their country and not due to their own desires for financial and political gain.

1. They should ensure a secure and stable environment to enable free trade, innovation, development and production through securing our national borders, and protecting against internal threats such as racketeering, intimidation, violence and corruption, and defend the country from any external threat to our way of life.

2. They should enable the citizens of the country to better themselves in every possible way thought quality education by the means of creating quality infrastructure such as housing and roads; delivering basic services like running water and electricity to each home and telecommunication for further development in regards with education.

3. They should not be allowed to have parastatals like Eskom or Telkom, any funding which the Government give to public enterprise ventures should be seen as loans after an in depth due diligence report was drawn up, and there must be little or no interest.

4. Financial institutions should be regulated in regards with the amount of personal loans they give out to an individual, and the interest charged on these loans, as well as keep an eye on bank administrative charges.

5. Lastly, the salaries of serving political figures and leading figures in the public sector like the police and defence force should be voted on by the public themselves.

Governing the Government fall in the hands of the citizens of the country, and we should not be lax in our attitudes or our resolve towards the Government, because this creates the perfect opportunity for the human condition called Greed to raise its ugly head. We voted them into power, and it is our common responsibility to make sure that they stay on the straight and narrow, long past are the days of Monarchs and Feudal Lords who believed that the peasants where there to serve their every whim, the Government is the Public's servant.

TAXES AND TAXATION

Taxes are the compulsory financial contribution by a person or body of persons towards the expenditure of a public authority. In modern economies taxes are the most important source of government revenues.

Taxes have 3 functions:

1)fiscal or budgetary, to cover government expenditure, to provide the public authorities with the revenue required for meeting the cost of defence, social services, interest payments on national debt, municipal services, etc;

2)economic, to give effect to economic policy, to promote stable economic growth, to influence the rate of economic growth of the nation;

3)social, to increase the economic welfare of the community, to lessen inequalities in the distribution of income and wealth.

Taxes may be direct or indirect. For example, taxes on income and on capital are known as direct; taxes on commodities or services are known as indirect.

Taxes may be proportional, progressive and regressive.

 A proportional tax is one that imposes the same percentage rate of taxation¹ on everyone,no matter what their income.

A progressive tax is one that imposes a higher percentage rate of taxation of people with high incomes than on those with low incomes.

A regressive tax is one that imposes a higher percentage rate of taxation on low incomes than on high incomes.

TAXATION IN THE USA AND GREAT BRITAIN

Taxes are the compulsory financial contribution by a person or body of persons towards the expenditure of a public authority. In modern economies taxes are the most important source of government revenues. Taxes on income and on capital are known as “direct” taxes. Taxes on commodities or services are known as “indirect’ taxes.

Businesses and individuals are subjects to many forms of taxes. The various forms of business organization are not taxed equally. The tax situation is simplest for proprietorships and most partnerships; corporations or companies are treated differently.

In the United States of America nearly all of the federal government’s revenues come from taxes. By far the most important source of tax revenue is the personal income tax. Gross receipts from corporate income taxes yield a far smaller percentage of total federal receipts. Individual states levy their own taxes. As a result, for example, the profits of a corporation are liable to federal and sometimes state corporate income taxes. This often imposes a double tax burden. When the after-tax income is paid out to stock-holders as dividends, it is then taxed again as personal income.

In the United Kingdom there is no single code of tax law, the body of tax legislation being increased by each year’s Finance Act¹.

The United Kingdom operates a “schedular” system², where’by taxable income from different sources is calculated and taxed under the rules of a particular “schedule”.

Tax assessments are normally based on returns by the Board of Inland Revenue (referred to simply as “Inland Revenue”) for completion by the taxpayer. While companies may receive tax return, they normally submit instead a copy of their annual accounts together with a computation of taxable profits.

The United Kingdom does not yet operate a system of self-assessments for tax on income and capital gains, but it is being introduces at the moment.

TAXATION IN UKRAINE

Under Ukrainian law, all Ukrainian legal entities, whether they have foreign investment or not, are subject to the profit tax law. Foreign entities that have a taxable permanent establishment in Ukraine are also taxed under this law.

Ukrainian taxes provide revenue for two tiers of the budget: national and local. The major taxes paid to the budget are: tax on income, tax on wages, profit tax, excise duty, state duty, value added tax (VAT) and others.

In Ukrainian government tries to create the climate in which business can thrive, to keep the tax burden as low as possible. It also attempts to eliminate tax allowances, which deprive the budget of tax revenues, and to improve tax collection.

Tax returns in Ukrainian legal entities are audited by the tax authorities at the time they are submitted.

If the company or a person assessed believes the assessment is incorrect in any way, an appeal may be lodged against it. The appropriate financial organ is required by law to reply to such an appeal within five days.

When a company resident in one country receives income or gains from source in another, or when shareholders and company are domiciled in different countries it is possible that incomes arising will be taxable in each country, i.e. taxed twice.

A number of countries have problems because of significant taxpayer non-compliance.

Along with cases of illegal evasion of tax obligations there are entirely legal ways of avoidance by which a person may so arrange his affairs as to minimize, or even eliminate, tax liability on his property and income.