The role of government. Taxation. Business Ethics
For two or three decades, determining the role of government in the business cycle has been perhaps the central issue in political and economic industrial democracies. Although the number of nationalized industries has steadily declined in most regions of the world, people with the left wing still considered generally believe that government has a role to play in providing economic infrastructure (public transport, telecommunications , etc.) and ensure the provision of services such as health care education, social security and possibly housing, and regulating the working conditions, health and safety standards, and so on. People with right-wing views, however, generally argue that many (or most or all) of these activities can be left to private enterprise and market system, and the role of government should perhaps be restricted activities such as defense, police and the justice system. They argue that regulation is bad for business too, and leads to inefficiency.
enemy
For example if we look at the role of the Department of Commerce and Industry, which is under the jurisdiction of the British government, we will see next image . The main areas of intervention are the development DTA trade, investment and exports, development of industry within the UK, and to regulate or to ensure open, competitive markets, mergers and the policy of monopoly. And the main objective of the work of DTI at the moment is to provide a detailed analysis of markets, the priority markets that Britain aims to fir, for the service industry, and then help them, including business small and medium enterprises, to address these markets effectively. The specific aid is that each priority market, there are 80 of them around the world, having an office clerk who is solely responsible for providing information on the country, the detailed economic and political market information throughout this area of ??your interest. And beyond that, they can give you the assistance of the Embassy of that country.
not what kind of help, the government may be useful in other areas. A famous American economist JK Galbraith tried to describe the responsibilities of the state as he sees it. First, no country in the market system to provide good affordable housing. This is an important issue and should be around a public responsibility, because ill-housed or homeless are clearly inconsistent with the right company. Health care
is also a public responsibility in all civilized countries, and many other critical functions ? parks and recreation facilities, police, libraries, arts. All those who are required by the underclass than the rich. Those who attack the government services are generally those who can afford to provide similar services for themselves.
polite society it must also be attention to science, including medical research. The market system is investing for a return to relatively short term. Therefore, to support science is the responsibility of the state. But all the information above does not mean that everyone share that view. Another famous economist R. Friedman, the role of government as it is today has greatly limited our human freedom. According to him the limitations of our economic freedom threaten to two centuries of economic progress to completion. I?ll try to explain this view. An essential part of economic freedom is the freedom to choose how to use our income: how much to spend on ourselves and on what items, how much to save and in what form, how to give and to whom. Currently, over 40% of our revenues are eliminated on our behalf by the government at the federal, state and local combined. As consumers, we?re not even free to choose how to spend this part of the income out of what remains after taxes as there are many restrictions on the purchase or consumption of certain goods -. for cars without seat belts, for example
And the freedom to use the resources we have in accordance with our own values ??- freedom at the entrance to any occupation, engage in any what company to buy or sell to someone else ? this is regulated by the state. Today you are free to offer your services as a lawyer, a dentist, for example, without being first a permit or license from a government official. You are not free to work overtime on terms mutually acceptable to you and your employer, unless the conditions are in accordance with rules and regulations established by a government official.
So it was a different opinion, unlike the first. Both are very logic and reason for existence. Maybe we should somehow combine to create an ideal system suitable for all? TAXATION
A tax is a sum of money legally required by a governmental response to public spending.
Everyone knows that taxation is necessary
? Modern state: without it, it would not be possible to pay the soldiers and police who protect us, nor the workers in government offices that deal with our health, our food, our water, and all other things we can not do it ourselves, or as ministers and MPs who govern the country for us. Through the tax we pay for things we need, as much as we need a place to live and eat something.
But if everyone knows that taxation is necessary, different people have different ideas about how the tax should be organized. There are two main ways through which taxes can be paid:
1) each person to do?? ? some money to the government each year
2) there? tax on things people buy and sell.
In most countries
,? direct taxes on individuals, which is called income tax exist. It is arranged in such? Thus, the poorest? nothing, and the percentage of tax grows as a taxpayer?s income increases.
But
countries direct taxation are almost always indirect taxation , too. Many things imported into the country to pay taxes or ?homework? . Of course, it is men and women who buy these things imported into the stores who really pay the fee in the form of higher prices. In some countries, too, there? Goods sold in stores. If things most needed are imposed? Much money is collected, but the poor who suffer most. If useless things such as jewelry and fur coats are taxed less money is obtained, but the tax is fairer, that the rich pay.
Probably the latter type of indirect tax with a direct tax on income which is low for the poor and higher for the rich is the best arrangement. The main function of the tax
is, of course,
to raise revenue to finance government spending , but the taxes can also have for other purposes. Indirect excise duties, for example, can be designed to deter people from
smoking, drinking alcohol , and so on. Governments can also encourage investment
by allowing various methods of accounting for accelerated depreciation
that allow companies to deduct the cost of investments over their profits and therefore reduce their tax bill. It is always? much debate about the fairness of tax systems
. Corporate profits, for example, are generally taxed twice
: companies pay tax on profits (corporation tax in the UK, income tax in the United States) and the shareholders pay tax on dividends. Income taxes in most countries are progressive, and are one of the ways that governments can redistribute wealth. The problem with progressive taxes is that the marginal rate of
? people pay tax on any additional income ? is still high, which is in general? disincentive both work and invest. On the other hand, most sales taxes are slightly regressive because the poor need to move? greater proportion of their income on consumption than the rich. many countries taxes are quite fair and not to harm the interests of citizens. There may be countries where government spending is not very high and therefore there is no need to levy high taxes or the government has other revenue streams such as profitable businesses. Or the state police is to give more freedom to companies to make better economic situation. But some have money governmnents insufficient to fund its expenses and they increase the tax rate as an alternative to borrowing. Or they can restrict the business useless. Of course, this reduces the incentive to work, because profits become very small.amd many businessmen try to hide their income. There are many methods, both legal and illegal, to hide profits from taxation. For example, tax evasion (by reducing the amount of tax you pay at a minimum) or tax evasion (making a false statement to the tax authorities). The higher the tax rate, the more people are tempted to cheat
, but there?
substantial ?black? or ?underground? the economy almost everywhere. In Italy, for example, self-employed ? whose income is more difficult to control than the company?s employees ? account for half of national income morethan. Many people have also not reported, the jobs of part-time evening (some call it
?black? ) with family-owned small and medium-size, on which no one pays no tax or National Insurance. At the end of 1986, the Director of the Italian National Institute of Statistics has calculated the size of the underground economy, and added 16.7% in product gross national Italy (GNP ) figure, and then said that Italy had surpassed Britain to become the fifth largest economy in the world.
In order to reduce the tax liability, some employers give a lot of highly paid employees
?benefits? (short for perquisites) instead of money taxable such as company cars, free health insurance and subsidized meals. Legal means of avoiding tax, like them, are known as loopholes in the tax laws. Life insurance policies, pension plans and other investments in which individuals can defer payment of tax, are known as tax shelters . Donations to charities
can be deducted from income on which tax is calculated. Companies
? ways to avoid income tax. They may have capital spending (on new factories, machines, and so on) so that by the end of all the profits were used, which is known as the making? tax losses . Multinational companies often set up their headquarters in countries like Liechtenstein, Monaco, the Cayman Islands and the Bahamas, where taxes are low, these countries are known as tax havens . Criminal organizations, meanwhile, tend to spend money through? series of companies in complex transactions to hide its origin from the tax inspectors ? and li ;????. This is known as money laundering
Business Ethics
In the 1920s, many large U.S. companies have begun on a large scale to create pension funds, employee ownership, and life insurance plans, unemployment compensation funds, restrictions on working hours and high wages. They built houses, churches, schools and libraries, provided medical and legal services, and gave money to charities. Since this behavior is quite surprising for commercial companies, there must be a good explanation. And I guess we have it.
First of all I want to mention that words such as ?ethics? or ?culture? used to be considered to have less in common with the business. But this is not the case. Today, the positive image of an entrepreneur is an essential part of any businessman, needed for success in business. And we hope that this picture is not just fluff. corporate values ??and ethics are linked much closer than it appears at first sight. Business ventures include dealing with people, make contacts different, and as you know the contacts with people are usually constructed on the basis of trust. You do not need to cheat to obtain benefits. It is usually the result of the situation when the market price exceeds the expenses. Although many examples
to conclude a deal on parole reflect the fact that the promise given by the person whom you trust may be more valued than money given by someone else.
Cheating
, compromises with his conscience bear witness to the immaturity of the market relations, the ignorance of businessmen. It seems logical enough, but many people running their own business to forget this basic truism ? unfair business has no future. Once delivered, a person you trust or even start playing the game itself.
So, to make a finding of all the above mentioned, I would say that the company, any company has responsibilities to its suppliers, customers, employees, local community and society in general and for its shareholders. It will provide benefits in the way of good business with loyal partners, the loyalty of workers, improving the environment, etc. Therefore large companies introduced ?social capitalism? as a way to create a favorable public opinion. Even rational capitalists, beginning with Henry Ford realized that a better-paid work force would be more loyal, and would be able to buy more goods and services, and a better workforce educated would be more effective one. Of course, pure free-market theorists disapprove of welfare capitalism and all actions inspired by ?social responsibility? rather than trying to maximize profits. As the benefits of such initiatives are not visible, Milton Friedman criticized them for unbisinesslike and threaten the survival not only individual companies but also the general vitality of capitalism. In newspaper article entitled ?Corporate social responsibility is to increase its profits? he argued that the responsibility of any business is to conduct business in accordance with their desires, which will generally make as much money as possible, while adhering, of course the basic rules of society, both those enshrined in the laws and those who are enrolled in ethical custom. So
leaders should not make expenditures on reducing pollution beyond the hill that is required by law or that is in the best interest of the company. They should not voluntarily commit the least skilled, long-term unemployed, or workers from ethnic minorities who suffer discrimination. To do is to be guilty of spending shareholders (or customers ?or? employees, regardless of) money. Friedman does not consider the possibility that shareholders may prefer to receive less dividends, but live in a society with less pollution and less unemployment and fewer social problems.
A view alternative to the illustrated article by Friedman shareholder is a model of speakers pointed out, for example, in the book of John Kenneth Galbraith, The New Industrial State. Under this approach, business leaders have responsibilities to all groups of people with a stake or interest in or claim against the company. A company that is managed for the benefit of all shareholders, will not, for example, to pollute the area around its plants, or close a factory employing hundreds of people in a small town with no other major employers, and move production elsewhere in order to make small financial savings. Proponents of the stakeholder approach suggests that suppliers, customers, employees and members of the local community should be strongly represented on the board of directors of a company. Another aspect of business ethics, I want to cover the concerns of the difference between the legitimacy of certain actions and their relevance, to the basic rules of society. Sometimes we do some actions are widespread, but that does not mean they are legal. For example espoinage industrial or bribe corrupt officials, saying that half of the truth in advertisements and concealing bad aspects of a product. Lobbying, I mean trying to persuade politicians to pass laws favorable to your industry, is legal, but it can be condemned by public opinion. So it?s quite difficult to choose which rules to follow ? the laws, business practices, clean conscience ?
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Source: http://businessandmanagement.info/2011/07/the-role-of-government-taxation-business-ethics/
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