WAEC Economics 2010 Theory — Question 23

Model answer

The principles of taxation, also called canon of taxation, include: (a) Economy: the process of collecting the tax should not require high cost. (b) Certainty: the tax payers should be fully aware of the amount they are asked to pay, when and how to pay it. (c) Neutrality: the tax should not be aimed at punishing or making life difficult for anybody. (d) Simplicity: the tax system (the law and the process) should be simple, not too complex to understand. (e) Equity: people should pay according to their ability to pay (any four).