But countries with direct taxation nearly always have indirect taxation, too. Many things imported into the country pay taxes or “duties”. Of course, it is the men and women who buy these imported things in the shops who really have to pay the duties, in the shops. If the most necessary things are taxed, a lot of money is collected, but the poor people suffer most. If unnecessary things like jewels and far coals are taxed less money is collected, but the tax is fairer as the rich pay it.

Countries vary in the balance of their taxation: some rely more on direct taxes while others prefer indirect taxation.

Text C. Types of Taxes

Taxation is very complex, and here we can outline only the most important categories. Thus taxes can be divided into federal, regional and local depending on the area and place of residence. Depending on the way taxes are levied, they are divided into direct and indirect ones.

Text D. Direct Taxes

Direct taxes are taxes paid on income or capital of individuals persons or corporals. The example are personal income tax, corporation company tax on profits, social insurance tax and some other. Indirect taxes are those paid on goods and services, that is when money is spent. Examples are value added tax (VAT) customs and excise duties. Income tax is the most significant countries, it forms the largest part of revenues collected by the government. In Russia the income tax is only 13 % whereas in Britain it usually is as much as 30 %. Also, income tax tends to treat different a people equally. The idea is: the largest a person’s earnings, the this tax is at least potentially, a progressive one: more is paid as income rises. This may become a drawback of there is no incentive to work harder because people may feel that they earn relatively less and pay more tax. If nearly half of what people earn goes to the government, they might prefer to work fewer hours and spend more time in the garden or watching TV.

However, if income tax is truly progressive it is an important means of increasing the elastically of the tax structure.

It is also worth nothing that income tax is rather a simple one to collect, as many employers pay the tax directly for the employees, deducting it from the salary before it is paid.

What is most needed to make income tax more effective and fair is a radical improvement of its administration.

2.2.5.3 Задание 1. Ответьте на вопросы по текстам А, B,С, D

1 What do governments spend money on in every society?

2 Trough what is government expenditure spending financed?

3 What is a tax?

4 What does fiscal policy mean?

5 How may the government reduce or increase demand for goods and services?

6 When do people have less money to spend?

7 What does fiscal policy use to promote economic stability and growth?

8 What questions occur about how taxation should be arranged?

9 How do countries vary in the balance of their taxation?

10 What does direct taxes mean?

11 What does indirect taxes mean?

2.2.6.1 Задание 1. Прочитайте и запомните следующие слова и словосочетания:

essential part – основная часть;

business paper – деловые бумаги;

recipient – получатель;

to intend – предназначать;

impression – впечатление;

agreement – соглашение;

venture – смелое предприятие, осмеливаться;

to involve – вовлекать;

negotiation – переговоры;

to draft – проект, набросок;

to enforce – следить за соблюдением;

to avoid – избегать;

inquiry – запрос;

offer – предложение, предлагать;