In a civilized society, a citizen needs to pay levy in order to enjoy good quality of living. While the most widely known purpose for paying taxes is to fund government projects, services and operations, there are several other reasons for it. The levies are also used to influence people's spending and spread wealth in lower-income citizens. The puerto rico tax law defines how the government can collects money from private individuals and business establishments.
There are different forms of levies like property tax, sales levy, and income taxation. On the other hand, commercial enterprises have to pay business taxes to continue operation. Regardless of its source, the collections are allotted for specific purposes aimed at improving the quality of life for the citizens and betterment of the state and the country.
Federal income tax is the chief means for the government to fund is operations. These include federal health, education programs, national defense, federal judiciary and aid to local and state governments. The responsibility to pay the debts of the entire country and provide general welfare to its citizenry is accorded to the Congress, according to the Constitution.
The very first form of taxation is the tariff imposed on liquor, tobacco and other merchandise. The Congress only enacted the country's first income tax in 1862 to finance the civil war. However, it was eliminated in 1872, a few years after the war ended. In 1895 Supreme Court ruled that income taxation is unconstitutional.
Presently, the majority of collections from tariffs and levies are used in effective government administration. Without it, government operations may not be sustained. It would be impossible to provide important services like creating laws and promoting national policies. Funding security and military forces are also of great importance to keep the country and its citizens free from security threat.
Furthermore, taxation is significant for the proper distribution of wealth among taxpayers and recipients of government assistance. The levies imposed on an individual is proportional to the money he makes. Individuals with higher income are expected to pay higher taxes as well. The collections are used in supporting middle class and lower-income citizens so as to deliver equal services to all citizens.
Levies imposed on goods may also influence people's reception to it. Depending on the government's purpose, it may encourage or discourage public consumption of certain products. For instance, the state imposes higher tariffs on alcohol and cigarettes to help moderate its use. The funds from anti-smoking campaigns can also benefit public health.
Like the federal government, the municipal and the state governments also rely on income levies and local sales to perform their basic functions. There are municipalities that collect property taxes in order to raise funds for fire departments, public schools and road constructions. Other times, lowered tax rates are used to encourage population growth in the area to beef up its local economy.
Certain locality may have special provisions on taxation. The puerto rico tax law, for example, promote the place through lowering their taxes. Most residents do not have to pay federal income levies anymore. This draws in many wealthy people to live in the area. A person just needs to live 183 days on the island every year to keep his residency legal.
There are different forms of levies like property tax, sales levy, and income taxation. On the other hand, commercial enterprises have to pay business taxes to continue operation. Regardless of its source, the collections are allotted for specific purposes aimed at improving the quality of life for the citizens and betterment of the state and the country.
Federal income tax is the chief means for the government to fund is operations. These include federal health, education programs, national defense, federal judiciary and aid to local and state governments. The responsibility to pay the debts of the entire country and provide general welfare to its citizenry is accorded to the Congress, according to the Constitution.
The very first form of taxation is the tariff imposed on liquor, tobacco and other merchandise. The Congress only enacted the country's first income tax in 1862 to finance the civil war. However, it was eliminated in 1872, a few years after the war ended. In 1895 Supreme Court ruled that income taxation is unconstitutional.
Presently, the majority of collections from tariffs and levies are used in effective government administration. Without it, government operations may not be sustained. It would be impossible to provide important services like creating laws and promoting national policies. Funding security and military forces are also of great importance to keep the country and its citizens free from security threat.
Furthermore, taxation is significant for the proper distribution of wealth among taxpayers and recipients of government assistance. The levies imposed on an individual is proportional to the money he makes. Individuals with higher income are expected to pay higher taxes as well. The collections are used in supporting middle class and lower-income citizens so as to deliver equal services to all citizens.
Levies imposed on goods may also influence people's reception to it. Depending on the government's purpose, it may encourage or discourage public consumption of certain products. For instance, the state imposes higher tariffs on alcohol and cigarettes to help moderate its use. The funds from anti-smoking campaigns can also benefit public health.
Like the federal government, the municipal and the state governments also rely on income levies and local sales to perform their basic functions. There are municipalities that collect property taxes in order to raise funds for fire departments, public schools and road constructions. Other times, lowered tax rates are used to encourage population growth in the area to beef up its local economy.
Certain locality may have special provisions on taxation. The puerto rico tax law, for example, promote the place through lowering their taxes. Most residents do not have to pay federal income levies anymore. This draws in many wealthy people to live in the area. A person just needs to live 183 days on the island every year to keep his residency legal.
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