Have you have pondered over why the government makes us pay a fraction of our hard-earned money? What exactly do they do with the money that we pay as taxes? What is tax and how the citizens pay these in varieties of forms under plenty of names and norms?
A tax indeed is a compulsory financial charge that the government of a particular country or a place accumulates from the capable citizens who have gained financial independence and earns enough to sacrifice a part of it for the development of the place they reside in.
We often think of it as a waste of our personal money but paying taxes to the government of a country ensures our own development in terms of better prospects and infrastructure. The government invests the collected taxes in the development and pays to the government servants who serve the citizen through various services.
The idea of taxation is very crucial to businesses because governments can utilize this money back into the economy of the country in various forms as loans or other funding forms. Taxes help improve and push the standard of living in a country. The higher the taxes we pay, the better the standard of living. Pick any country with the best infrastructure and see the taxes paid to the government by the citizens.
Today in this article we will try to know about the most common types of taxes levied by the government on the citizens.
GST stands for Goods And Services Tax which is an Indirect Tax which has engulfed many Indirect Taxes in many of the countries like India and Canada. Goods & Services Tax is a comprehensive, multi-stage, destination-based tax that is imposed on every value-added goods. The concept of GST is very complex and needs acute skills to nail it down.
VAT stands for Value-Added Tax which indeed is a consumption tax imposed on the consumers of any product where the vat is depicted on a product whenever a value is added at each and every stage that the product passes through.
The harmonized sales tax (HST) is a consumption tax popular in Canada. The calculation of the HST became easier after the advent of the Ontario HST calculator. HST is a blend of Canadian goods service taxes and PST which stands Provincial Sales Taxes.
Ontario HST calculator is considered to be the best calculator developed for the calculation of Harmonised Sales tax.
4. Income Tax
Income tax is collected from all those who are financially independent and earn enough to share a fraction of it for the development of the country. Everybody who earns more than a certain amount has to pay income tax to the government.
It is indeed a tax that the government imposes on the income generated by the citizens of the businesses within the ambit of their jurisdiction.
It is very important to pay our taxes for the development of the country we live in. Our paying taxes ensures our own security. The government uses the amount collected by the individuals and the businesses to invest it back in the economy and infrastructure.
Hope you find this article helpful and informative. Do let us know your honest feedback through your comments.