Explain any five characteristics of tax.

1.	Explain any five characteristics of tax.
Answer» Characteristics of tax are : (i) It is a compulsory contribution. No one can refuse to pay a tax, on the general ground that he doesn’t derive any benefit from certain state services. (ii) The fact that tax is a contribution implies the notion of a sacrifice involved on the part of the contributor. (iii) Tax payment is a personal obligation. (iv) Taxes are actually based on a great variety of material things as well as non-material and intangible form of wealth. (v) A tax is levied according to certain legal requirements. (vi) The amount of tax is not fixed with reference to the exact benefit which a taxpayer receives from public service. (vii) A tax is paid out of the income of the taxpayer. (viii) The power of taxation is mainly to be used for collecting revenue to the state.

Answer»

Characteristics of tax are :

(i) It is a compulsory contribution. No one can refuse to pay a tax, on the general ground that he doesn’t derive any benefit from certain state services.

(ii) The fact that tax is a contribution implies the notion of a sacrifice involved on the part of the contributor.

(iii) Tax payment is a personal obligation.

(iv) Taxes are actually based on a great variety of material things as well as non-material and intangible form of wealth.

(v) A tax is levied according to certain legal requirements.

(vi) The amount of tax is not fixed with reference to the exact benefit which a taxpayer receives from public service.

(vii) A tax is paid out of the income of the taxpayer.

(viii) The power of taxation is mainly to be used for collecting revenue to the state.

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