What is an Income tax?

For the government to stay alive it puts out a tax which is usually called income tax, and every citizen pays after their earned income like wages, salaries or commissions and unearned income like dividends interest or rents. The income tax varies from country to country but the most widespread taxing is the progressive income tax. This means that there are different categories depending on how much a person earns. Usually the more you earn the more tax you pay this is how the wealth is distributed.

The money earned from taxing the citizens is going to the government and it can fund different projects with that. Also there are two types of taxes personal income t ax for the common people and there’s corporation income tax which is for companies and firms. Also the more levels that the taxation has the more loopholes it offers, and when loopholes appear then people take advantage of them and might be paying less tax then they should and they can do that with out concern of braking the law.