What are taxes used for?

What you need:

• General knowledge
• Interest in further training and information
• Knowledge of tax law
• Knowledge of types of taxes
• Knowledge of tax laws

Definition of taxes and what they are to be paid for

• The citizens of Germany are due to the laws to financing public budgets forced. However, this does not entitle you to any direct consideration. The payments relate to certain characteristics such as income, property or net sales at companies.
• Basis for implementation or Collection serves the tax authorities with the valid tax law. All persons (including foreigners) are subject to unlimited income tax if they have their place of residence or habitual abode in Germany.
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• As a "normal citizen" you will encounter the wage tax that applies to every wage or salary tax. Payroll is deducted based on tax bracket and other characteristics.
• One also speaks of direct and indirect taxes. An indirect tax is in the form of the purchase price value added tax, To pay mineral oil tax or tobacco tax at the same time as the value of the goods.
• The state generates the two most important revenues from income tax and sales tax.


Difference between taxes and duties properly explained

The difference between taxes and duties is not a difference per se, as the ...

• A basic distinction is made between different types of tax. This includes the community tax, the federal tax, the state tax and the municipal tax.
• The tax revenue itself is divided into three main categories, on the one hand in Transport taxes, including in Germany sales tax, real estate transfer tax and the Insurance taxes count.
• In the case of consumption taxes, which are based on the consumption of goods, the mineral oil tax, the tobacco tax or the electricity tax can be cited.
• Property taxes, property taxes and income taxes are assigned to the so-called property taxes. The increase in wealth brings with it the payment of income tax, corporation tax and trade tax after deduction of tax exemptions.

Government spending - what taxes are used for

• The community must be financed with money that citizens have to pay as taxes.
• Without a well-functioning infrastructure, the economy could not last long, so the state has to ensure that the income is used wisely. Therefore, the tax money must be distributed to the federal, state and municipal budgets according to a certain ratio. A fixed key serves as the basis for this.
• Citizens' payments are used, for example, for public investments such as buildings (hospitals, Schools, kindergartens), personnel expenses for salaries of the public service as well as pensions and various social benefits (Unemployment benefit, social assistance, child benefit, etc.).
• The areas of education, health or road construction must also be covered by the "public sector".
• The largest sources of income for the state are wage and income tax, sales tax, corporation tax, trade tax and motor vehicle tax.

Taxes are therefore used to cover the financial needs of the federal, state and local governments and to plan or plan them sensibly. to spend. The right to recovery is known as "tax sovereignty". As citizens, we are obliged to pay, even if we sometimes look critically at what the money is actually used for.