Essay on Taxes as an Instrument of Policy

According to Atkinson (1996), “as the 20th century dawned, new political forces came to the fore demanding voting rights for the working classes and fairer distribution of tax burdens. Indeed, taxation quickly became a major battleground of both economic interests and ideology. In traditional tax systems the poor bore much heavier tax burdens than the rich. But, as unions, as well as working and middle class parties mobilized, their political representatives increasingly demanded that taxes be used as instruments to change the maldistribution of income and wealth brought about by capitalism. Indeed, the very origins of what we now call ”˜modern’ tax policies (that is, efficient, universal and equitable taxes) were seen as a partial solution to the growing problem of inequality in modern society.”

In such a way, we can say that the concepts of tax, levies, duties and other obligatory payments mean contribution to the corresponding level or the extra-budgetary fund, taxpayers exercised in a manner and under conditions established by legislative acts. The collection in the state levied taxes and other charges, as well as forms and methods of their construction make the tax system in fiscal policy. At the same objects of taxation are very different; for instance, revenues and the cost of certain products, certain types of taxpayers, securities’ transactions, the use of natural resources, property, businesses and individuals, the transfer of property, value-added products and services and other facilities established by legislative acts are among them. Taxes as an instrument of fiscal policy are of two types. The first type includes taxes on income and wealth: personal income tax and tax on profits of companies, social security, payroll and labor (social contributions), property taxes, including land and other real estate, transfer tax on profits and capital abroad. They are charged with a specific person or entity, and they are called direct taxes. The second type are taxes on goods and services, sales tax or value added tax, excise taxes (directly included in the price of goods and services) to the inheritance; on real estate transactions and securities, and others. This type of taxes is considered to be indirect taxes, since they are partially or completely transferred to the price of goods or services.


Social Security and Reducing Poverty among the Elderly

Taking into account the changes in the functionality, the citizens of the older generation are characterized by loss of usual social status, the unstable financial situation, poor health, reduced ability to self-service. The elderly is difficult to adapt to the changing socio-economic conditions by the age characteristics. Little (2004) said that most of them can not resolve their problems and difficulties alone. The need for different types of social service experience 80% of disabled elderly people, while more than 30% of the elderly are in constant need of outside assistance and social and medical services.

State social policy is dictated by the targeting of social assistance, seeking to turn an old man in the subject of social security. Social security systems in countries with developed market economies include many different components. Therefore, social care institutions for senior citizens should pay great attention to the protection and care, recreation and treatment of the older generation with the use of new technologies, forms and methods of social work with the elderly.

In conclusion, social security and reducing poverty among the elderly is a priority in public policy. In such a way, a public mission is to provide the elderly with normal living conditions, while pensions should be increased along with the number of social service agencies to help the elderly.


To sum up, taking everything into consideration it is possible to conclude that we should consider the promotion of high-level rise of social and economic benefits of scale economy the most universal goal of the State. Socio-economic efficiency refers to the magnitude of socio-economic effect, the result obtained per unit of resources expended. Ultimately, exactly the socio-economic effectiveness, efficiency operation of the country’s economy, rational, cost-effective use of all components of its resource potential of the complex are characterized by the possibility of achieving the social objectives of government economic policy. So, the political forces, political parties, movements can have a tangible impact on the political, public and economic policy, while social aspects of public and economic policies are manifested in the fact that the government, taking economic decisions, creating the budget, allocating public expenditure, has to take into account the social responses of different population groups, particularly the leading groups. In such a way, we have observed and discussed politics, public and economic policies, and took into account all the main concepts associating with the topic, in the body of this paper.

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