Essentials/Features/Characteristics of a Good Tax System:
After discussing
the
principles of taxation, it is now easy for us to sum up the
essentials of a good tax system. They, in brief,
are as follows:
First,
a
good tax system should lead to fair and equal distribution of
wealth in the community.
Second,
it
should be composed in such a way that it yields sufficient
revenue to the government.
Third,
the cost on collection of taxes should not be excessive.
Fourth,
the
burden of taxes should be distributed in proportion to the
ability of the tax-payer, i.e., it should be progressive in
character.
Fifth,
taxes
should he levied at such a time or in the manner which is most
likely to be convenient for the tax-payer to pay it.
Sixth,
tax
system should be fairly elastic.
Seventh,
there
should be certainty with regard to the time and the amount to be
paid to the government.
Eighth,
the
system of taxation should be fairly simple, It should also be
easy to administer.
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