Equity and Taxation Questions

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Running Head: EQUITY AND TAXATION 1

Equity and Taxation

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Institution

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EQUITY AND TAXATION 2

Equity and Taxation

Question One

Unlike equality which is an equal opportunity and support to all, equity is aimed at

attaining fairness and ultimately, the equality in the society. Bursary and scholarships to needy

students is an example of equity while equality is the free universal education. The tax burden is

distributed based on one’s ability to pay (Mikesell, 2018). Therefore, taxation system worldwide

is designed to create equity in the society through redistribution of income.

Question Two

The benefits received theory dictates that a tax is burden should be proportionate to the

benefits a tax payer receives from the government through rendered. The theory assumes and a

quid pro quo between the government and tax payer. The principle demands the government to

confer benefits in the form of social goods to the tax payers in exchange for tax (Mikesell, 2018).

The principles of fairness and equity also demands that paid taxes should be proportionate to the

benefits received from the government.

The principle of ability to pay is all about promoting fairness and equity. Accordingly,

the tax burden is varied based on ones’ ability to pay. For achievement of equity and fairness, the

wealthy should pay more tax than low income people to ensure an equal tax burden. Consistent

with horizontal equity element, people with equal ability bears an equal amount of tax burden

(Mikesell, 2018). For vertical equity element, unequal individuals are supposed to be treated

differently depending on their ability to pay.

Questions Three

The concepts of horizontal and vertical Equity are aimed at creating equity and fairness in

the society through taxation. Horizontal equity demands that tax payer with equal ability to pay

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Running Head: EQUITY AND TAXATION 1 Equity and Taxation Name Institution Date EQUITY AND TAXATION 2 Equity and Taxation Question One Unlike equality which is an equal opportunity and support to all, equity is aimed at attaining fairness and ultimately, the equality in the society. Bursary and scholarships to needy students is an example of equity while equality is the free universal education. The tax burden is distributed based on one’s ability to pay (Mikesell, 2018). Therefore, taxation system worldwide is designed to create equity in the society through redistribution of income. Question Two The benefits received theory dictates that a tax is burden should be proportionate to the benefits a tax payer receives from the government through rendered. The theory assumes and a quid pro quo between the government and tax payer. The principle demands the government to confer benefits in the form of social goods to the tax payers in exchange for tax (Mikesell, 2018). The principles of fairness and equity also demands that paid taxes should be proportionate to the benefits received from the government. The principle of ability to pay is all about promoting fairness and equity. Ac ...
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Tags: equal opportunity free universal education create equity principle demands tax payer