This website uses cookies to ensure you have the best experience. Learn more

Taxation Essay

1093 words - 4 pages

Every organization which provides goods or services to fee paying customers must, by its very nature, charge price for that good or service, to pay for its costs, have retained profits for investments and to keep its shareholders happy. In theory, the market price of any good or service is determined by the interaction of forces of demand and supply. The concepts of demand and supply can be claimed to be among the most important in economics. In order to understand either of them it is necessary to examine the factors that determine them. Although a good's price relative to other goods is probably the most important factor influencing demand for most goods, most of the time, there are other factors as well. These are disposable income, the price of complimentary goods and substitutes, tastes and preferences, expectations, size of population, advertising. Suppliers, on the other hand, are interested in making profits, and thus anything that affects profitability affects the supply. These include the price of other products, costs, technology and goals of firms.The price of any product is determined by the interaction of the forces of demand and supply. The market price is set at the point, where demand equals supply, equilibrium. When an economist refers to the demand for a product he/she means effective demand, which may be defined as "the quantity of the commodity, which will be demanded at any given price over some given period of time." However, the price of the good or service varies according to the changes in either demand or supply. In order to show that it is necessary to look at determinants of demand and supply separately. One of the factors that might affect the demand for beer is a disposable income, income less taxes. For most of the products, when disposable income goes up the demand goes up as well, and vice versa, thus affecting the price of the product. A rise in income leads consumers to buy more of a product, as they have more money to spend.Another factor, which influences demand, is the price of other products, substitutes or complementary goods. Complementary goods are purchased together to satisfy one want, and these goods are in joint demand. In modern world the advertising can also cause changes to the demand. A successful advertising campaign can increase the demand, and thus price, by shifting the demand curve to the right and at the same time move the demand curves of the competitors to the left. Price changes can also be caused by change in one or more of the determinants of supply, like costs or technology. Therefore, if any of the costs change, it will result in the changes in supply and thus prices. The government can also force the companies into higher costs, like the introduction of the minimal wage, which will increase the company's costs. If the costs increase at any given level of output the producers will attempt to pass on these increases on to consumers in the form of higher prices. If they are unable to...

Find Another Essay On Taxation

Double Taxation Essay

1712 words - 7 pages Introduction Double taxation arises when an individual or business acquiring income in a foreign country is required to pay taxes on that income in both the foreign country as well as the country of origin. For example, an American company operating in a developing country, in the absence of a tax treaty between the two countries may have to pay a withholding tax to the government of the developing country, as well as corporation tax to the

Corporate Taxation Essay

1994 words - 8 pages service the taxpayer might or might not enjoy. The primary reason for the imposition of tax is to gather revenue for the functioning of Government. Services such as road maintenance, schools, hospitals, etc. require funds which are collected via taxation. These are the most basic operations of government which requires tax funds. A few other complicated reasons for the collection of tax can be to fund wars or encourage a rapid economic

Internet Taxation

2011 words - 8 pages Internet Taxation Should states and local governments be able to impose internet tax on individuals and corporations? Maybe they should not, but they are. There are currently twelve states and the district of Colombia that currently impose sales tax on internet access. There are also 10 states that presently collect taxes on data downloads. Who pays for these taxes? And how is this tax computed? Is there truly justification for this

Progressive Taxation System vs. Flat Taxation System

1076 words - 5 pages The United States’ economy, as everyone knows, is not in its best shape. One way the government gains money is by imposing taxes on people. There are many taxes that are placed on different items that the public needs or already has. The United States uses a taxation system which is criticized by many people due to not fully understanding the system. The system used is called progressive tax. However, many people believe the system of flat tax

Taxation and Political Stability

2234 words - 9 pages The proposed analysis: taxation and stability policy with a sample of 60 countries around the world during the period 2002 to 2008, helping to make distinctions between the political instability experienced but maintained high taxation, and those states with political stability but with a low taxation. The few variables that are used in the model, and its reduction to a two-way relationship is one of its merits, when compared with other models

Double Taxation Relief

3628 words - 15 pages INTRODUCTIONThe purpose of this paper is to provide a means to minimize or eliminate double taxation through double taxation relief, to reduce the risk of under taxation by promoting cooperation among countries. As far as we know lower overall taxation encourages trade and investment as well as opportunity for growth and profits. The possibility of double taxation arises when two or more countries claim simultaneous jurisdiction to tax the same

Taxation of the Wealthy

1618 words - 7 pages   Introduction For decades the controversy on raising taxes for the wealthiest Americans has been an on-going debate. During every election and congressional session- whether state or national- the politicians all hold strong views about the taxation of the wealthy. Since the last term of President Eisenhower the taxation of the wealthy has been declining and for the past ten years leveling out with the ‘upper middle class’. The latest stance is

Taxation in Canada

774 words - 3 pages Taxation levels are very complicated for Canadian citizens. I believe that Canada will economically break free when taxation levels become less onerous. Government regulation hits our pocketbooks as surely as taxes do, but there is little information available about its cost. At a time when deficit spending is out of favour, and there is little appetite for tax increases, this lack of accountability makes regulation a tempting way for

Taxation on Cigarettes

1599 words - 7 pages companies. This settlement, was essentially what led into current taxation policies surrounding cigarettes. In exchange for a surplus amount of taxation of cigarettes, states would provide legal protection for cigarette companies; more specifically, they negotiated an acceptable tax increase. This settlement however, did not satisfy the government. So the Clinton administration began working several reinforcements that would make the previous

Condominium Association Taxation

1149 words - 5 pages Accounting, Audit & Corporate Finance Library, Editorial Materials, Specialized Industries, Homeowners’ Associations, Chapter 5 Income Taxes, 502 Form 1120-H – Taxation under IRC Section 528 Accounting, Audit & Corporate Finance Library, Editorial Materials, Specialized Industries, Homeowners’ Associations, Chapter 5 Income Taxes, 503 Form 1120 – Taxation under IRC Section 277 “CONCORD CONSUMERS HOUSING v

Taxation of Credit Unions

1490 words - 6 pages operating as non-profit, organizing without issuing capital stock, and worked for the benefit of their members. This exemption is currently costing the federal government $1.6 billion in tax revenue. With the current growth of credit unions, that amount could rise to $2.2 billion in 2018 (Puzzanghera, 2013). Not only does the tax gap credit unions create a fiscal issue for Congress, supporters of the taxation of credit unions argue that it also

Similar Essays

Taxation Essay

995 words - 4 pages Taxation systems are usually modeled in such a way that they take into consideration the social welfare of the citizens. The government and other policy makers have the responsibility of ensuring that the system takes into account the needs of the citizens. The bottom line is that taxation should foster equal distribution of resources. The rate of taxation is usually arrived at after several considerations have been made. The rates are not fixed

Taxation Essay

813 words - 3 pages When taxation is mention, eyebrows are raise, not just here in the United States but in mostcountries globally, especially those countries of which participate in international trading ofgood. Taxation is definitely an involuntary fee paid to the government from individuals withbusiness or private citizens. Taxation has become a hot discussion in the theories of economistand even in political parties. Taxation has three legitimate legal

Taxation Essay

1096 words - 4 pages PAGE PAGE 1 Taxation TaxationTaxationIn today's world, the majority of our government's income comes from taxation. Taxes are required payments of money to various local, states, and federal governments, and they are used to provide public goods and services to benefit our communities. The government uses the income it receives from the taxpayers to provide us with proper infrastructure and social services for little or no cost at all. These

Taxation Essay 799 Words

799 words - 3 pages TaxationTammy W. EasonAxia College of University of PhoenixThe effect of taxation and price controls on the economy range from the curtailment of the supply of goods to an increase in costs. When there is a tax impose on goods like tobacco or cigarette as described in the two articles, there is an increase in the price of the product, this shifts the supply curve of the product to the left, in other words less quantity is available at the same