Odurinde Finance & Business Blog

Taxes are considered to be the share of state from your earning. You must be sweating day and night to earn money for your requirements. But here comes the catch, you have to earn to pay taxes as well. Many people consider that taxes are essential luxury which must be afforded with hard-earned money. So taxes are here to stay and you have to manage to pay on time. Many people wonder in different parts of the world that government collects tax from us but our life style does not improve. Many countries have real bad tax systems and most of these countries are in Asia. Almost all the poor countries have high taxes on personal and business income. Some of those go as high as 60% of personal income. Asian countries have very high taxes on imports and sometimes double than the actual cost of the product. So much tax collected but still the infrastructure is poor and bad roads are everywhere.

The big question is, where is tax payer’s money is going?. Highest percentage of total tax collected, comes from salaried individuals. Salaried class suffers with the tax and remaining income. Even after paying the taxes on salary, one ends up paying more taxes on each item purchased from anywhere. According to a rough estimate, only 40% of your income is tax free. It means 60% of the money goes in paying the taxes. Many countries like UK allow person to be an enterprise and pay the taxes on what ever is remaining after expenses. That way, many people are able to save good amount of money. No country is exception where tax payer’s money is not wasted by the politicians. However, taxes can not be removed from the system. Your money in taxes is an investment into growth of the country and it is required to build schools, roads and other necessary infrastructure.