Facts
Issue
Any organization making profit is entitled to pay tax to its respective country revenue authority. Different countries charge different tax rates on the profits of the organization. For instance, in United States calculation of tax liability to any organization depends on specific provisions of accounting standards that guide in the preparation of financial statements. In 2008, Massachusetts had to adopt reforms in tax laws that led to recovery of high amounts of corporate tax that were lost in the previous period (Edwards, 2008). Many organizations tried to avoid payment of corporate taxes. The laws made it possible for revenue authority to collect high amounts of money inform of corporate tax.
Analysis
Corporate tax collected by revenue authority of any respective country is used to run government activities that lead to development of economy. Corporate tax is used to build roads, social amenities, pay civil employees, support education sector and many other economic activities (Craig, Todd, 1993). A country with good infrastructure is economically developed because there is good flow of goods from one country to another thus it benefits through foreign exchange earning. This is one way among the many ways of using corporate tax to help promote growth of economy.
In conclusion, it is the role of any organization or business entity to pay corporate tax so as to support the growth of economy. Without payment of tax, government cannot operate its activities well. Authorities concerned with collection of tax should ensure that the tax is used in a proper manner.
Categories:
0 comments:
Post a Comment