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  • Category: Miscellaneous

    Taxation system - A short comparative summary.

    All the countries in the World have a taxation system through which the Government collects taxes from its citizens and provides basic facilities to the general masses in return.

    I was just analyzing and trying to see summarize it in a small format to explain it to anyone easily, so I came up with the below analysis.

    A taxation system is like a herd of sheep grazing in a green field, owned by a person and there are few dogs that are there to maintain order among the grazing sheep.

    The field is the country with opportunities and work.
    Sheep are the citizens.
    Dogs are administration and police.
    The owner is the Government.

    Now the sheep are free to graze and feed itself and as soon as the wool grows the owner of the field takes away the wool and leaves the sheep to graze again. If the sheep wanders here and there, then dogs will chase them and bring them back in the circle and even bite sometimes.

    The taxation system of any country works in a similar fashion wherein the people have to work and part with taxes and if they fail to do so then administration and police will ensure that the same is collected through legal means and deposited to the exchequer of the Government.

    Note: Few liberties of comparison have been taken so please don't take offense as many people may be in Government or administration.
  • #715345
    After hectic day of work. I came across this post which emanated laughter in me as the author has compared the taxation system with that of some thing else.
    K Mohan @ Moga
    'Idhuvum Kadandhu Pogum "
    Even this challenging situation would ease

  • #715387
    A good comparison. The example suits well to the system. The only difference I see is in our taxation is having some set of rules to decide on the tax to be paid. But in the example given there are no set of rules and the owner is at liberty to decide on in taking away the wool. Anyhow the taxpayers in India are really like a herd of sheep with no voice to make the government listen. They have to pay tax and should not expect anything in return from the government.
    always confident

  • #715399
    You have described it very nicely and if you feel that dog is slightly an offending word as some of us might be working in Govt then it can be replaced with watchdogs. I think you have very well illustrated it as Govt has no other way to earn tax except from the sheep only as others would show their profits as very low or compensated by their expenses which are legally allowed to set off against the revenue. It is a big revenue for Govt but at the same time if the Govt reduces the tax percentage then I think compliance will be better and more people will come forward to pay the taxes voluntarily. The boundary between Rs 10 lakh and above 10 lakh is to be shifted upwards may be at Rs 50 lakhs if the Govt really wants to increase the compliance. Once GST is fully implemented even for the small shopkeepers then the direct tax like Income Tax can be totally abolished and you only pay taxes when you buy something. Do not spend unnecessarily and do not pay taxes. Let us see what happens in this matter in the coming year.
    Knowledge is power.

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