Why Pay Taxes?

 Throughout history, people have been paying taxes in some form or other.  Tax is a contribution to state revenue compulsorily levied on individuals, property, or businesses.  Most of the time, it is when the budget of the present government comes out that people ask themselves why pay taxes, especially of there has been an increase in the price of some services.  There are actually several reasons for which taxes should be paid.

Firstly, by paying taxes we are in fact providing money to finance the government.  All governments need payments of money from people; taxation is the most important source of revenue for modern governments, typically accounting for ninety percent or more of their income.  In the United States, for example, about twenty-eight percent of the gross domestic product – a measure of economic output – goes for tax payments.  In Canada, about thirty-six percent of the country’s gross domestic product goes for taxes.  In France, the figure is forty-four percent, and in Sweden, it is fifty-one percent.  Without taxes to fund its activities, government could not exist.

Image via Wikipedia

The money obtained from taxes is used for the welfare of the inhabitants and for the development of the country.  It serves primarily for the protection of the people.  As a matter of fact, one of the largest government expenditure is national defence which consists of paying for and supporting the members of the armed forces: this absorbed about seventeen percent of the federal budget of US in 1997.  Other such important expenditures include police and fire protection.  Tax revenues are also used to build dams and roads, to provide food to the poor.  So it is necessary to pay taxes in order to maintain peace and security in the country.

Paying taxes furthermore implies that is government will cater for the non-defence aspect as well.  A fundamental program is social security whose role is to provide income to individuals during their retirement years.  Another major program for the benefit of the elderly is Medicare, a health insurance program.  The government also spends taxes on social welfare programs which make up of unemployment insurance and payments of cash and food to the poor.

Moreover, government use the largest share of their tax revenues on public school systems.  This gives people the guarantee that all their children will receive proper education through a better equity since schools are now, in most countries, open to all races and classes.  In today’s society, education is the only way by which one can climb the social ladder.  Therefore, by operating public schools, the government is encouraging people to become educated so that the country makes progress faster – another good reason to pay taxes.

In addition, taxes help in the redistribution of a society’s wealth.  This is achieved by imposing a heavier tax burden on one group in order to fund services for another.  In the above way, paying taxes contributes greatly in maintaining the stability of a country’s economy.  By imposing a bigger tax on the rich people than on the poor ones, for instance, there will be more or less equality and justice to the inhabitants.  The country also will not be torn between two extremes. 

As it can be seen, to pay taxes is indeed a ‘good obligation’ since it brings many benefits to a state even though sometimes there happened to be unpopular taxes which often led to protests as it did in case of the Boston Tea Party in 1773.

Image via Wikipedia