Net Tax Gap Analysis

Tax avoidance has become a massive topic of discussion over the past few years, given the current global economic conditions and the cuts to the public sector by the government as a result. This led to increased anger from the public who perceive avoidance by many of the country’s wealthiest people in a time of austerity as greed. Perhaps the most notable demonstration of this anger can be seen in the actions of the group UK Uncut, who for the past year have been organising protests at shops owned by retail tycoon Philip Green who, as the poster boy for tax avoidance, paid a £1.2 billion dividend to his Monaco-resident wife.

Jill (45,000 – 500 – 2000 * 75%, yr1/ 134,500 – 1,000 – 2,500 * 75%,

Arlen is required by his divorce agreement to pay alimony of $2,000 a month and child support of $2,000 a month to his ex-wife Jane. What is the tax treatment of these two payments for Arlen and Jane?

Ann paid $500 for her books and supplies and she incurred living expenses of $7,400.

Stanton Delaplane once joked about the IRS, saying he heard it had suggested a simplified tax form with only one question: How much money did you make last year? The IRS response was, "Mail it in"." Thank goodness, our taxes haven 't gotten quite that bad. It is true though, that the majority of Americans, most of us included, have to bite the

British Parliament declared that the crown and the British parliament had the right to make laws that affected the colonies so as to maintain order. The mother country also had the right to maintain a military presence over the colonies if it was so required. Concerning taxation, Jenyns states that the colonists’ view that taxation must be preceded by the power to elect representatives is unfounded, citing the example of towns in Great Britain who did not have explicit parliamentary representation but are still taxed (Para. 2). Also, the document refutes the notion that taxation can only Thus, with the consent of the people. Therefore, Parliament had the power to impose taxes on the colonies and additionally held the right to use these taxes.

In a Summary Opinion, the Tax Court has determined that a taxpayer could deduct the costs of obtaining a master of business administration (MBA) as unreimbursed employee expenses. The Court found that the MBA didn't qualify him for a new profession but rather refined his existing business and investment skills that he used in his former managerial position, and it further concluded that the taxpayer remained in the same trade or business before and after attaining the degree.

The United States tax system is in complete disarray. Republicans and Democrats agree that the current tax code is complex, unfair, and costly. The income tax system is so complex; the IRS publishes 480 tax forms and 280 forms to explain the 480 forms (Armey 1). The main reason the tax system is so complex is because of the special preferences such as deductions and tax credits. Complexity in the current tax system forces Americans to spend 5.4 billion hours complying with the tax code, which is more time than it takes to manufacture every car, truck and van produced in the United States (Armey 1). Time is not the only thing that is lost with the current tax system; Americans also lose

There are several possible explanations for the gap, and understanding the origins of the gap will point to policies that can

On the other hand, people who consider tax avoidance a right of an individual or a company consider aggressive anti tax avoidance attitude of government to be socialist in nature instead of democratic. They argue that it is the right of any person to keep the maximum amount of money that he or she earned and pay least amount of tax required. They think that questioning the morality of a tax avoider is not appropriate because he has more right to that money than the government and instead of questioning the morality, government should lower tax rates, simplify tax process and legislate accordingly (Ryan Bourne, 2012).

A sales tax does not create this motivation; in fact, it punishes people for making money. The more money made or spent, the more money paid in taxes. The same is true for income taxes: more made means more paid, especially with graduated income rates that tax a progressively higher percentage the greater a salary is. These taxes punish those who make more money,

Tyler focuses on two main theories of compliance throughout his book, these are the instrumental and normative perspectives. Although most of the previous research conducted in this area has focused on the instrumental perspective, this study utilizes the normative one. This allows for one to focus on what people regard as just and moral opposed to what is in their self-interest. People will choose to voluntarily obey the law if they view compliance as an appropriate form of behavior. This feeling of personal or normative commitment can involve personal

Tax system is a legal system of imposing and collecting taxes from the citizens of the country. As it has been stated by Albert Einstein, the hardest task in the world is to understand the tax system of a country. The United States’ tax system is so complicated that its tax code contains almost 3 million words and 6,000 pages. Moreover, the taxes implied by city and state governments add more complexity to the federal taxation system. In this case, we do not need to understand the complexity of tax code system in order to get acquainted with the significant role of taxes in American society.

The individual income tax is complicated, and it violates transparency standards through created loopholes (or tax preferences) which allow some to pay less than their fair share of taxes (Mikesell, 2011). In 2005, more than 70 percent of individuals filing taxes had tax preparers complete their returns because of confusing rules and regulations that could penalize taxpayers for qualifying for certain legal tax preferences (Mikesell, 2011). This transparency problem exists because citizens are really unaware of how to determine their tax liability except at the end of the year. Income taxes are collected annually through the Internal Revenue Service (IRS), and there are constant complaints about the IRS not willing to assist taxpayers

I’ve summed up the introduction of Taxation to these slight words. Taxation is defined as a way that the government able to generate or collect revenue from the citizen of one’s nation through different sources. As what I’ve learned from Taxation course that there are two types of taxation, direct which are paid by the taxpayer directly to the government, and indirect which are collected by an intermediary (like a retail store) from the consumer. The intermediary who will file the tax return later and forward the amount of the money to the government with the return. This tax is applicable to organizations and individuals. In this reflection, I would like to highlight what I learned of business and individual taxation, the experience on working with a group for the project and what challenges I faced and how I was able to get past.