3.1. Answer the questions:
1. What are the five characteristics of a good tax system? 2. What does each of them imply?
3. Are these principles applicable to the tax system in your country?
4. What do you know about the tax system in your country? 5. What would you do to improve it?
3.2. Find in the text English equivalents for:
перераспределять
доход;
приносить
двойной
дивиденд;
повышать
эффективность;
собирать
налоги;
вечный предмет споров;
осуществлять руководство налоговой системой; вмешиваться в …;
заполнять бланки для уплаты налогов; отучать от курения;
уклоняться от уплаты налогов.
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4. VALUE ADDED TAX IN GREAT BRITAIN
Text 4
Read the text.
General explanation
The main internal taxes on expenditure are the excise duties on tobacco, drink and hydrocarbon oils (petrol and diesel), together with Value Added Tax (VAT), which is, in effect, a single system on the sale of goods and services.
All countries within the Common Market (the EEC) are obliged to operate a VAT system, thus smoothing the way for the harmonization of the laws of member states on turnover taxes.
The VAT system has a great advantage in being, in the eyes of the Treasury, an economy regulator. Changes in the rates of VAT can be made by Treasury Order, within the Statutory Regulations.
The law concerning VAT is contained in the Finance Act 1972, and is administered by Orders and Regulations made under that Act by the Commissioner of Customs and Excise, from headquarters at Alex-ander House, Victoria Avenue, South End-on-Sea, SS99 1 AA.
Operation of VAT
The appropriate amount of tax is collected at each stage of the process of production or distribution of goods or services, and the final tax is borne by the consumer, who is the ultimate purchas-er or user at the end of the line.
At each stage of the business suppliers charge VAT on goods, trading stock, materials to be used in manufacture, and the services used in the normal day-to-day running of the business. All these goods and services supplied are ‘inputs’, and the tax paid on them is ‘input tax’.
When the business proceeds to supply goods and / or services to customers, VAT is charged to such customers as a separate amount. The supply of the goods and services by the business is ‘output’ and the tax collected on them is ‘output tax’.
At prescribed intervals the business must make a return to Customs and Excise on which is totaled respectively the amount of input and output. It follows that if the output tax amount is greater than the amount of input tax the balance is payable to Customs and Excise. If the opposite were the case, a refund would be made.
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Rates of tax
The Treasury by Order, under the Act, regulates the rates of VAT, and currently this is the ‘standard’ rate. There is, however, a range of goods and services which are the subjects of a ‘zero-rate’, and others which are ‘exempt’ from VAT. Both zero-rating and exemption mean that no output tax is chargeable. An important difference lies in the provision that on zero-rated goods or services the VAT charged on inputs, relating to them can be reclaimed like any other input tax. On the other hand, exempted goods or services are outside the scope of VAT, and no input tax can be reclaimed in respect of them.
The ranges of goods and services designated as zero-rated or exempt are specified in a VAT Notice No. 701, obtainable from VAT offices.