Introduction to Taxation:Regressive,Proportional,and Progressive Taxes

Introduction to Taxation
Name
Institution Affiliation
Course
Professor
Date
Introduction to Taxation
1. Regressive, Proportional, and Progressive Taxes
A progressive tax is a type of tax that considers a higher income percentage from a high-income individual than the low-income ones. Therefore, it focuses on the specific income that one receives. On the other hand, proportional tax is imposed regardless of socio-economic status, and it does not consider whether an individual falls in a high or low-income group (Jones, 2015). A proportional tax is relevant since it promotes equality between average and marginal tax rates. Lastly, a regressive tax makes lower-income individuals pay more than high-income individuals, and it is the direct opposite of progressive tax. The three taxes are vital since they determine the income of different groups.
2. Canons of Taxation
Adam Smith is known for his role in establishing canons of taxation. He believes that there is no significant connection between the payer's benefits and the tax. The four canons of taxes, according to Adam Smith, include the canon of economy, certainty, convenience, and equality (Jones, 2015). Canon of the economy is based on minimizing cost for tax collection. Therefore, the government must utilize less expenditure in collective taxes. Canon of certainty established on a transparent and clear process of tax collection. It determines the transparency among the officials responsible for tax collection. Therefore, it allows the taxpayers to trust the tax collection process. Canon of convenience focuses on the timing of taxation. The process should be convenient to the taxpayers by focusing on appropriate scheduling. Canon of convenience also allows the taxpayers to ...