1. Simplicity: A good tax system should be simple and easy to understand for both taxpayers and tax administrators. It should avoid unnecessary complexity, complicated calculations, and excessive paperwork.
2. Efficiency: It should be efficient in terms of collecting taxes and allocating resources. An efficient tax system minimizes the costs of tax administration and compliance while maximizing tax revenues without imposing a heavy burden on the economy or hindering economic growth.
3. Equity: A good tax system should be fair and equitable, ensuring that individuals and businesses contribute to the tax burden in proportion to their ability to pay. It should aim to reduce income inequality and promote social justice by implementing progressive tax rates and offering targeted tax exemptions or benefits to support the vulnerable and promote economic stability.
4. Transparency and accountability: The tax system should be transparent, with clear and well-defined rules and regulations that are easily accessible to taxpayers. It should also foster a sense of accountability by effectively managing tax revenues, ensuring they are allocated judiciously to provide public goods and services, strengthen infrastructure, and foster economic development.
Highlight any four features of a good tax system
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