In the text, find the answers to the following questions

1. How are taxes defined?

2. What do the functions of taxation show?

3. What are the main functions of taxation?

4. What does the allocation function of taxation express?

5. When was the regulatory function of taxation implemented?

6. What is the regulatory function of taxation aimed at?

7. What sub-functions is the regulatory function of taxation divided by?

8. What are they aimed at?

9. What does the replication function represent?

10. What can you say about the controlling function of taxation?

11. What function of taxation has a social facet?

 

Exercise 3. Find a word in the text that matches each definition below. The words appear in order.

1.  (two words) Taxes, duties, fees.                            _______________
2. (three words) A large and persistent issue in developed and developing countries.                                                              _______________
3. (two words) Provides for the achievement of the main social goal of taxation.                                                                  _______________
4. The action or process of allocating or sharing out something. ____________
5. (two words) The use of taxation to ensure that the incomes of the richer members of the community are reduced and those of the poorer members are increased.                                                           ________________
6. (two words) Describes the ratio (usually expressed as a percentage) at which a business or person is taxed.                                    ________________
7. (two words) Something that motivates a producer or consumer to follow a course of action or to change behaviour.                      _______________
8. (two words) A tax levied on imports (and, sometimes, on exports) by the customs authorities of a country to raise state revenue, and/or to protect domestic industries from more efficient or predatory competitors from abroad.                                                         _______________
9. (two words) Provides projections of Government revenue and expenditure for the following year, and outlines services to be delivered. ____________
10. (two words) The choice by a government as to what taxes to levy, in what amounts, and on whom.                                               _______________

 

Exercise 4. Sentence completion.

Read the sentences and complete them with the following words.

by-product      reduction        unlimited quantities of money     

levy taxes         arise               imposition     

bank deposits            local government units

 

1. Transfer of money from people to government gives rise to two functions of taxation: a __________ in the spending potential of the private sector and an   increase in the spending potential of the public sector.

2. The negative function of reducing the spending potential of people often may be viewed as an unfortunate _________ of taxation.

3. Few city officials, for example, would applaud the fact that as a result of the________ of local taxes, the local citizenry has less money to spend.

4. For ___________, it is the financial needs of the government that justify taxation.

5. Until recent decades, this view was assumed correct for all levels of government; taxation was believed to _______ solely out of the financial needs of governments rather than from a public objective of reducing citizens’ spending power.

6. A sovereign government with an advanced type of financial system controls the money system and, as one feature of this control, can if it wishes provide itself with ________ at negligible cost.

7. This power arises from the use of national money in the form of __________ and currency as opposed to commodities, such as gold and silver, whose quantity cannot be increased by government decree.

8. A national government needs no longer __________ in order to finance itself.

Exercise 5. Text completion.