In the name of Allah

Taxation Accounting 1st lec

Difference between Price, Fees, and Taxes;

Price: for a good
Fee: for a service
Tax: a duty for all residents in the country (obligatory).
: a duty for all whoever is earning salary or revenue
(households ,firms).

Principles of imposing taxes;

1- Equity: taxes paid according to ability to pay.
2- Convenience: payment should be at times most
convenient to tax payers.
3- Certainty: to provide tax payers with all relevant
information e.g. (a peal procedures) to avoid problems.
4- Economy: the proceeds of tax must be more
than the cost of collecting the tax (Adam Smith).
Classifications of taxes: -
1- Direct and Indirect:
1.Direct: there is a direct relationship between tax payer
and the tax authority.
EX: - . salaries and wages tax.
. commercial and industrial profit tax.
. Non-trading professions. (‫)ضريبة القانون العام‬
. Real states tax.
. Building tax.
. Land tax.
2.Indirect: which is imposed on the tax payer without
being in a relation with the tax authority.
: also known as Blind Tax regardless the status
of the payer.
EX: - . Stamp tax.
. Sales tax.
. Value added tax V A T.
. Customs tax.
2- Personal and Impersonal tax:
1.Personal: offers allowances and exemptions to tax
payers.
2.Impersonal: no allowances and no exemptions.

All direct taxes are personal.

All indirect taxes are impersonal.

3- separate taxes and unified taxes:

1.Separate: more than one tax each for specific income.
(multiple taxes & multiple incomes)
EX: - . Building tax 10%
. Land tax 14%
. Salaries and wages tax 2% to 22%
Each payer has to present more than tax return to more
than tax authority. (tax return ‫)إقرار ضريبي‬
2.Unified tax: all incomes from all sources are subject to
one tax only law 91 for 2005
4- Taxes on income:
Higher tax for higher income
5- Taxes on capital:
Most countries don’t impose taxes on capital because it
results in capital erosion.