Role of Taxation in Developing Countries

by Craig Stewart Chief of Marketing & Sales

These days in the developing countries, tax and taxation is playing a very important role. Taxation maintains the economy at a higher employment level in order to raise the saving capacity of the people with an increase in income per head. Taxation also raises the marginal propensity to save the community above the average propensity to maximum possible extent. This is done without disturbing or discouraging the work effort or violating canons of equity. In Taxation Homework Help, the roles of taxation are explained very clearly. In order to mobilize a standard amount of revenue, taxation enables the government and then the tax revenue is imposed in the form of direct and indirect taxes.

Direct taxes include corporate tax, personal tax, etc. whereas indirect tax includes custom duty, excise duty, etc. Taxation respects the principles of equity and also follows them. Both the direct and indirect taxes are progressive in nature and thus taxation helps in the reduction inequalities of income and wealth. Apart from all these things, taxation also generates social welfare which is generated due to some undesirable products which includes tobacco products, alcoholic products, etc whose taxes are raised to restrict their consumption and thus facilitates social welfare. Half the amount of the tax revenue is utilized in social development activities which also improves the social welfare and social order of the society. Taxation is also involved in foreign exchange and encourages exports and restricts imports. The countries which are under development and the developed countries do not impose taxes on export items.

Types of Financial Planning in Business:

Financial planning is very broad concept and is filled with difficult and disciplined mission. There are various types of Financial Planning like cash flow planning, investment planning, retirement planning, tax planning, etc. Each of these planning is explained in Financial Planning Assignment Help. Cash Flow Planning is an important type of Financial Planning where an individual or a company forecast its short term and long term expenses against the projected cash flow. In case of incorrect cash flow planning, the company or the individuals may lead to bankruptcy.

Therefore appropriate cash flow planning is very much necessary. Investment planning is important in everybody’s life for achieving goals in life. Investment opportunities depend on the amount saved by an individual. An individual can invest a good amount of his/her savings in stock market, Forex market, mutual funds, etc. or can also start systematic investment plan for a long term in order to fulfil the long term financial plans. Insurance planning covers a long term and is a very critical type of financial planning. Under unforeseen conditions, if insurance is not planned in a proper manner then it might spoil the other financial plans also. Another important planning of finance is Retirement Planning which helps the people during their retirement life. Retirement planning is mainly done due to the rising inflation and rising standard of living and expenditures so that people do not have to compromise with their retired life.

About the Author:

Craig Stewart is an author of this article who writes about the importance of Taxation Homework Help. He has also written about Financial Planning Assignment Help.