Principles and functions of taxation reflect its social purpose. It acts as an instrument of cost redistribution of income. At the same time, at the practical level, the principles and functions of taxation form a set of means, using which the government maintains a balance between budget revenues and costs. All these properties are the subject of research by many financiers. Let us consider further what tasks taxation performs. Functions, types of taxes will also be described in the article.
General characteristics
Taxation is the taking of material values, which is based on imperious submission. It can be expressed in different forms. In some cases, taxation is accompanied by the use of force. However, as a rule, the withdrawal is the result of a consensus between subordinate and powerful subjects in exchange for some preferences received by the former from the latter. If we talk about the state structure, thentaxation acts as the basis for financing its activities. It is carried out at the expense of the funds of subjects that recognize the power and accept its protection.
Retribution and voluntariness
In fact, taxation is part of the relationship between powerful and subordinate subjects. At the same time, it is incorrect to talk about its gratuitousness and coercion. The latter acts as a compulsion to perform a certain duty. Coercion depends on the nature of the relationship. However, in any case, the fulfillment of the obligation is not gratuitous. For example, a vassal pays tribute to his patron. In part, this is a forced action. However, it is always rewarding. In return for tribute, the patron is obliged not to violate and even protect the interests of the vassal. Moreover, the latter often chooses a powerful subject quite consciously, that is, voluntarily agrees to pay. If we talk about the modern state structure, taxation acts as a set of similar relationships. In them, the subject, paying a fixed amount, ensures the fulfillment of the obligations assumed by the authorities. In other words, taxation is the subject of a certain agreement between the state and the population. Subordination is of secondary importance. This is due to the fact that the subject can independently choose the power and give him the appropriate powers.
Fiscal function of taxation
Fiscus literally means "basket" in Latin. In ancient Rome, the fiscus was called the military cash desk. ATShe kept the money for extradition. At the end of the 1st c. BC e. the term was used to refer to the emperor's private treasury. It was run by officials and replenished with income from the provinces. In the IV century. n. e. fisk began to be called a single nationwide center of the empire. Different types of receipts flocked here, funds were distributed here. The main function of taxation is to mobilize and form the finances of power structures. It ensures the accumulation of funds in the budget for the implementation of various programs. All other functions of the taxation system can be called derivatives of it.
Social task
This function of state taxation is to redistribute public revenues between different categories of subjects. Through the implementation of this task, the maintenance of social balance is ensured. Due to the distribution function of taxation, the ratio between the income of certain groups of the population changes to smooth out the inequality between them. This opinion is supported by various experts, including, for example, Professor Khodov.
Implementation
The implementation of the social function of taxation is ensured through the transfer of funds in favor of unprotected, weaker citizens. This is achieved by placing the burden on strong categories of persons. As the Swedish financier Eklund notes, most of the production and services are carried out with funds received from taxes, and are almost always distributed free of charge among the population. This, in particular, concerns education, medicine, parenting and some other areas. The goal in this case is to ensure a more or less even distribution of assets. Accordingly, funds are withdrawn from some entities and transferred in favor of others. Excises can be cited as an example of the implementation of this function of taxation. They are installed on some types of goods, luxury items. In a number of socially oriented states (for example, in Switzerland, Norway, Sweden), it is practically recognized at the official level that taxes act as a payment by highly profitable subjects to less solvent ones for stability in their social position.
Regulating task
John Keynes once spoke about this function of taxation. He believed that mandatory payments established by the authorities exist solely to regulate relations in the national economic complex. In this regard, the economic function of taxation is manifested. At the same time, it can be stimulating, reproductive or destimulating. Consider them separately.
Incentive
It is aimed at maintaining certain economic processes. Stimulation is carried out through benefits and indulgences. At present, the functions of taxes and the principles of taxation are manifested in such a way as to ensure proper working conditions for enterprises that employ people with disabilities, organizations that invest in production, charitable activities,agriculture, etc. Special benefits, "holidays" and other benefits are established for these and some other associations.
Destimulation
It, on the contrary, is aimed at creating obstacles to the development of certain processes. For example, the state applies protectionist measures and sets high import duties. Obstacles can also be created for internal actors. For example, there is an increased income tax rate for casino owners.
Contradictions
As Gorsky notes, regulatory and fiscal functions are opposed to each other. However, they themselves are very contradictory. For example, the fiscal element has a stabilizing value when it entails a reduction in the tax burden. This can only be done through burden sharing among payers. This, in turn, requires taking into account the regulatory instruments of withdrawal. However, the tax is not aimed at destroying its foundation. It exists to receive assets and cannot destroy the source of their receipt. The tax is not intended to confiscate, prohibit, restrict, or punish. In particular, the introduction of import duties is conditioned by protectionist policies, and high rates for the gambling business are associated with the solvency of the subjects, and not the desire to eliminate this area of activity.
Regulation Features
According to a number of experts, the role of tax mechanisms in the field of economic management is somewhatexaggerated. Some authors believe that the mandatory budget allocations established by the authorities are practically the only regulator of all financial and economic processes in the country. But the development of certain economic spheres is subject to its own laws. At the same time, contributions to the budget play a rather modest role there. In this sense, one can fully agree with Pepelyaev, who believes that in modern conditions the tax is set to generate income for the treasury. Accordingly, the impact that is exerted on the payer in order to obtain a particular result cannot act as its main goal. If some deductions perform only a regulatory function, without a fiscal component, then, strictly speaking, they cease to be taxes.
Practical Difficulties
The stimulating function of taxation, according to some experts, affects economic behavior indirectly, indirectly, through certain motivational aspects. The established obligation to allocate a certain amount to the budget does not activate the desire to earn. The tax is only a part of the profit received. If the business is initially inefficient, then no concessions will help it. For example, domestic agriculture has always been provided with a variety of benefits for almost all payments. However, this did not contribute to the progress and prosperity of the agricultural sector. Stimulation of investments in isolation from other economic factors will not bring results. This is due to the fact thatinvesting is not driven by tax incentives, but by the needs of production, the need to expand the business. In this regard, Potapov's statement that the tax stimulus is a secondary mechanism can be considered fair.
Negative Consequences
The regulatory function of taxation acts directly and immediately with a destimulating approach. There is no doubt about the veracity of the statement that everything that is burdened decreases. High tax rates always lead to a decline in production due to loss of efficiency. In particular, the unbearable burden in the 30s of the last century led to the liquidation of the peasantry in just a few years. More recently, after the introduction of a 70% deduction rate on the profits of video activities, video stores disappeared. Destimulating imports through imposition of high import duties also leads to a sharp reduction in the receipt of goods.
Control
Using taxation, the state provides supervision over the financial and economic operations carried out by citizens and enterprises, monitors the sources of income and expenses of subjects. The monetary value of mandatory contributions to the budget makes it possible to quantitatively compare profit indicators with the country's resource needs. Due to the control function of taxes (taxation), the government receives information about the movement of cash flows. When analyzing the data, the need to adjust the budget policy is determined.
Principlestaxation
They were first formulated by A. Smith. He deduced 4 key principles of taxation:
- Equality and justice. This principle assumes that all citizens are required to participate in the formation of the country's financial assets in accordance with their income and capabilities.
- Definiteness. The tax payable must be clearly stated. It should be clear to the population at what time the deductions should be made, in what amount, in what way.
- Frugality. Each specific payment should be as efficient as possible. Thrift is expressed in the minimum costs of the government to collect taxes and ensure the activities of control bodies.
- Convenience. Taxes should be levied in such ways and at such times as not to disturb the habitual activities of the payers. This rule involves the simplification of the expulsion process, the elimination of formalities.
Adam Smith not only formulated, but also scientifically substantiated these provisions. He laid the foundation for the theoretical development of the foundations of taxation.
