Compulsory financial charge: Tax is a mandatory payment imposed by the government, which individuals or corporations are legally obligated to pay.

Imposed by the government: Tax is levied by the government at various levels, such as local, state, or federal, to generate revenue for public services and programs.

Based on income or the value of goods or services: Tax calculations can be determined either by an individual or corporate income or by the value of goods or services sold.

Funding public expenditure: The primary purpose of tax collection is to finance public expenditure, including infrastructure development, social welfare programs, defense, and public services.

Income tax: A tax that individuals or businesses pay on their earnings or profits, calculated based on the income brackets and tax rates set by the government.

Sales tax: A tax levied on the sale of goods and services, usually imposed as a percentage of the purchase price and collected by the seller.

Property tax: A tax imposed on the value of real estate properties, including land, buildings, and homes, which is used to fund local government services and infrastructure.

Corporate tax: A tax levied on the profits of corporations, typically based on their net income after deducting business expenses and allowable deductions.

Value-added tax (VAT): A consumption tax imposed on the value added at each stage of production and distribution of goods and services, ultimately borne by the end consumer.

Excise tax: A tax imposed on specific goods, such as tobacco, alcohol, gasoline, or luxury items, as an additional cost for their consumption or use.

Capital gains tax: A tax on the profits obtained from the sale of an asset, such as stocks, real estate, or artwork, which is calculated based on the capital appreciation.

Inheritance tax: A tax imposed on inherited wealth or assets received from a deceased person's estate, typically based on the value or size of the inheritance.

Taxpayer identification: Individuals and businesses are required to obtain a unique taxpayer identification number (TIN) to ensure proper tax reporting and compliance.

Tax return filing: Taxpayers are obligated to file tax returns, providing detailed information about their income, deductions, and credits, enabling the calculation of their tax liability.

Tax assessment: Tax authorities review the tax returns filed by the individuals or businesses, verify the reported information, and determine the amount of tax owed.

Tax payment: Taxpayers are required to make the necessary tax payments to the relevant tax authorities, either through direct payment or as withholding from income.

Tax audits: Tax authorities conduct periodic or random audits on tax returns to ensure accuracy and detect any potential tax evasion or fraud.

Appeals and disputes: Taxpayers have the right to appeal or dispute tax assessments or penalties imposed by tax authorities, typically through administrative or legal procedures.

Revenue generation: Taxation is a significant source of revenue for governments, enabling them to fund public services, infrastructure development, and social welfare programs.

Redistribution of wealth: Progressive tax systems aim to reduce income inequality by taxing high-income individuals or corporations at higher rates and providing benefits or services to low-income or disadvantaged groups.

Economic stability: Taxation plays a role in regulating economic activity, promoting investment, and controlling inflation by influencing consumer behavior and allocating resources.

Funding public goods: Taxes help finance essential public goods and services such as education, healthcare, transportation, defense, and public safety, benefiting society as a whole.

Social engineering: Tax policies can be used to encourage or discourage certain behaviors or activities, such as imposing higher taxes on harmful substances or providing tax incentives for environmentally friendly practices.