Though not the first to observe this truth, Benjamin Franklin penned this maxim in 1789. Margaret Mitchell, the author of Gone with the Wind, wrote, "Death, taxes, and childbirth! There's never any convenient time for any of them."
Taxes have been around as long as Government - and in a more cruder form - as long as one human exerted dominance over another. Other than laws prohibiting individual liberty; taxes are the most intrusive form of Government upon the individual.
There are, in general, three purposes of taxes.
Fund General Government Operations. The obvious purpose of taxation is to fund general Government operations such as schools, defense, firefighters, police and the courts and other programs that benefit the citizenry at large.
Encourage & Discourage Behavior. Taxes are also used to encourage certain transactions and behavior. Home owners do not pay taxes on mortgage interest paid - while renters pay tax on all their rent. Married individual's incomes are taxed at a better rate than non-married individual. We reduce parent's taxable income for their children. Alternatively, we tax cigarettes, alcohol and the perhaps soon-to-be carbon tax.
Redistribute Income & Wealth. Finally tax can be used to take income from higher earners to give to lower earners. Income redistribution extends from programs that provide lower income citizens great benefits than higher earning citizens. Examples include the Earned Income Credit, Welfare, and Food Stamps.
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