ACC 377 Lecture Notes - Lecture 6: Severance Tax, Flat Tax, Internal Revenue Service
1. raise revenue for government
2. encourage/discourage certain behaviors
3. equality within tax laws; not necessarily equality across taxpayers (wherewithal to pay concept)
First Codification Year
1939
Tax Base
amount to which the tax rate is applied
Tax Rates
applied to the tax base to determine the tax liability
Proportional Tax Rates
everyone pays a flat tax rate
Progressive Tax Rates
increased tax percentages for increased income; based on ability to pay
Incidence of Tax
degree to which the tax burden is shared by taxpayers
4 Canons of Taxation
1. equality (fairness)
2. convenience (easy to pay; pay-as-you-go with holdings)
3. certainty (know what you owe)
4. economy (efficient and cheap to run)
Property Taxes
find more resources at oneclass.com
find more resources at oneclass.com
based on value of asset and generally imposed on realty (land or buildings) or personalty (cars, boats,
RVs, etc)
***exclusive jurisdiction of states and their local subdivisions
Transaction Taxes
1. excise
2. general sales
3. severance tax
Excise Taxes
type of transaction tax; restricted to specific goods such as gasoline, firearms, hotel occupancy tax,
rental car surcharge, etc.
***imposed at federal, state, and local levels
General Sales Tax
sales and use taxes (items purchased in other states but used in jurisdiction)
***imposed at state and county level
***alaska, delaware, montana, new hampshire, and oregon don't have sales taxes
Severance Taxes
tax on natural resource extraction
Death Taxes
tax on the right to transfer property or receive property upon the death of the owner; value of property
is evaluated ON DATE OF DEATH
1. estate taxes
2. inheritance taxes
Estate Taxes
levied on estate of deceased; federal estate tax is only imposed on estates larger than $5.49 million
find more resources at oneclass.com
find more resources at oneclass.com
Document Summary
Raise revenue for government, encourage/discourage certain behaviors, equality within tax laws; not necessarily equality across taxpayers (wherewithal to pay concept) Tax base amount to which the tax rate is applied. Tax rates applied to the tax base to determine the tax liability. Proportional tax rates everyone pays a flat tax rate. Progressive tax rates increased tax percentages for increased income; based on ability to pay. Incidence of tax degree to which the tax burden is shared by taxpayers. 4 canons of taxation: equality (fairness, convenience (easy to pay; pay-as-you-go with holdings, certainty (know what you owe, economy (efficient and cheap to run) Property taxes based on value of asset and generally imposed on realty (land or buildings) or personalty (cars, boats, ***exclusive jurisdiction of states and their local subdivisions. Transaction taxes: excise, general sales, severance tax. Excise taxes type of transaction tax; restricted to specific goods such as gasoline, firearms, hotel occupancy tax, rental car surcharge, etc.
