The taxation system of any state consists of different types of taxes and fees. The division of taxes into direct and indirect allows increasing their collection, and, therefore, contributes to filling the state budget and fulfilling its obligations to society.
Depending on the method of collecting taxes, they are divided into direct and indirect. This division is considered by some to be conditional, since, ultimately, both direct and indirect taxes are paid by the final consumers of products.
Characteristics of taxes
Direct taxes are levied on either the taxpayer's income or property belonging to him. These include taxes on the income of individuals, on the profits of enterprises, on the property of citizens and organizations. Payers of direct taxes are specific citizens or organizations, the tax base for direct taxes is relatively easy to determine, so it is not difficult to administer and collect them.
Indirect taxes are called taxes, the amount of which is included directly in the cost of production. They are sometimes also referred to as consumption taxes. Indirect taxes include value added tax, customs duties, excise taxes, government duties and taxes that are collected from the taxpayer for the implementation of a number of legally significant actions.
Features of indirect taxes
Indirect taxes are conventionally divided into:
- individual - paid from certain groups of goods;
- universal - they are imposed on almost all goods.
Individual indirect taxes include excise taxes that are levied, for example, on alcohol, tobacco products, gasoline and other fuels, and are paid by consumers of these products. Another indirect tax is customs duty, which is ultimately paid by all consumers of imported goods.
Tax exemptions are provided for certain types of goods and services. For example, for children's goods and foodstuffs, the VAT rate is 10%, and for other goods - 18%. Some goods, such as medical products, are not subject to VAT.
The attractiveness of indirect taxes for the state is due to the fact that their collection does not directly depend on the financial results of the enterprise. Even if the firm is unprofitable, these taxes must be assessed and paid. The fiscal effect of indirect taxes persists amid falling production and declining sales of goods.
At the same time, the administration of indirect taxes is unnecessarily complicated. Both corporate accountants and tax authorities agree that the methodology for calculating VAT is replete with ambiguously interpreted provisions, and the procedure for refunding this tax is confusing. Therefore, most tax audits reveal a lot of violations related to the calculation of VAT, and are accompanied by the additional assessment of tax amounts, as well as the imposition of penalties and fines on taxpayers.
