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Taxation act otherwise known as revenue law is the legal area of study which involves the study of constitutional laws, tax treaty, statutory laws as well as the regulatory rules that constitute the law applicable for the making of a better taxation system.
Tax is mainly imposed to accumulate funds for the functioning of government services so in short, taxes can be generally defined as a price for the services that the government is providing you with. Stealing taxes is like cheating yourself and your fellow citizens because the more responsibly you pay your taxes, the more enhanced government services become.
This explains the complete purpose of imposing taxation laws. Taxation laws are imposed to maintain this taxation procedure smoothly without any hassle. There is a process called tax evasion. It can be defined as the act of underpaying the taxes by a company or an individual.
Taxation laws ensure that at tax evasion doesn’t take place, and for every tax evasion a penalty process is assured. The taxation act works on the principle of adequacy, equity, and efficiency. Adequacy symbolizes sufficient services to all the sectors including the public service sectors; equity means taxation act would raise the living standards of all. Not only the rich but the poor can also get benefit from taxation law. Here the efficiency means enhancing the efficiency of government bodies by financing their expenditures.
As already said the primary purpose of taxation law is to maintain this taxation procedure smoothly without any hassle and so stop the tax evasion.
There are also other specific purposes that taxation law serves. These are listed below:
Taxes are the cooperative principles operating between the citizens and the government which funds the future economic welfare of a country. To achieve considerable success regarding a country’s capital growth or additional increment in socio-economic equity, taxes play a crucial role.
Nevertheless, a taxpayer often steals his share of taxes, and so that makes a country’s economy lagging concerning the other developed countries. Taxation laws play a crucial role in preventing the infringement of taxes in a particular country through several laws that dictate the valuable virtues of a tax system sustainably. This is why taxation laws become essential in a country where the parasite of corruption is consuming the economy like a deteriorating toxic poison.
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