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The Benefits Principle

One principle of taxation called the benefits principle states that people should pay taxes based on the benefits they receive from government service. This principle tries to make public goods similar to private goods. It seems fair that a person who often goes to the movies pays more in total for movie tickets than a person who rarely goes. Similarly a person who gets great benefits from a public good should pay more for it than a person who gets little benefit. The gasoline tax for instance is sometimes justified using the benefits principle. In some states revenues form the gasoline tax are used to build and maintain roads. Because those who buy gasoline are the same people who use the roads the gasoline tax might be viewed as a fair way to pay for this government service.  The benefit principle can also be used to argue that wealthy citizens should pay higher taxes than poorer ones. Simply because the wealthy benefit more from public service. C

Sad love SMS

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