Tax is a kind of financial charge that is levied by the local, state or federal government on the individual or on some legal entity. Broadly the taxes can be divided in two types - direct taxes and indirect taxes. The mode of tax payment may be both money and unpaid labor. The taxes make the main source of income for the governments while on the other hand; taxes are considered as a monetary burden that is laid upon a property or on the individuals. The taxes are not considered to be the donation or voluntary payment but are actually the contribution forcibly extracted from the tax payers. The government can impose the taxes on the various grounds like - toll, duty, tribute, excise, impost, subsidy, supply or aid. Depending on the nature of taxation, a tax can be progressive or regressive.
There are various types of taxes available in different regions of the world. Here is a list of the various types of taxes:
- Ad Valorem
- Capital Gains Tax
- Environment Affecting Tax
- Consumption tax
- Excises
- Corporation tax
- Income tax
- Poll tax
- Inheritance tax
- Property tax
- Retirement tax
- Tariffs
- Sales tax
- Toll
- Value Added Tax / Goods and Services Tax
- Transfer tax
- Wealth (net worth) tax
The ad valorem tax is imposed on the service, value of good or property. Sales taxes, property taxes, tariffs, inheritance taxes etc. are the types of ad valorem tax. The capital gains tax is imposed on the profit that is earned from the sale of a capital asset. The consumption taxes are levied on the spending and expenditures. The excise taxes are actually dependant on the quantity rather than the value. The corporate taxes are imposed on the profits earned by the companies. The income taxes are the taxes that are levied on the income of companies, individuals or corporations. The poll taxes are the per capita tax levied on each individual. The property taxes are imposed on the property and is payable by the property owner. The sales taxes are the taxes that are imposed at the time of the selling of product. The value added tax or VAT is equivalent to sales tax.
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