Every single year, no matter what, we have to do something: we need to call our tax consultant and give some of your entire income to the state. If you are a employee, you will pay taxes every month, but if you are a self-employee or a manager, you have to do for yourself. Some of us doesn’t like paying taxes, other hates that so much that they don’t pay them at all. There’s anybody in this universe who loves to pay taxes. However, the questions are: Why do we hate paying taxes so much? Is it right paying them?
Reason behind paying taxes!
How does a company or an industry work?
I want to start from a company. Why? Well, because i want to analyse how a company works. It doesn’t matter where you go, every workplace will have costs. It can be, for example, costs for heating, insurances, equipment or your salary. Those costs are not visible, because every single company sells something. It can be services or goods, but the company has always an income sources, used to cover all the costs and to make the owners richer. It’s absolutely right like that! I mean, if you found a company to lose money, you are not exactly the smartest entrepreneur of all time. So, a company works like that: i sell thing both to cover my cost and to become richer. Every single company worldwide works in that way.
Does the State work in the same way?
A State is similar to a company, although there are two big differences.
The State will hire people to work, like deputies, senators or a normal employee, like secretaries and drivers for example. More than that, there are massive costs to make sure that the country works properly. We are talking about the entire road system, public education, defence, sometimes Healthcare and much more. All this things are not for free or cheap. For the defence, for example, we talk always about billions or even trillions of dollar/Euros every year. There’s only one problem: a country doesn’t sell anything, nor goods or service. They provide them, but they don’t sell them.
Private In The Public Business.
“It’s not true! I have to pay if i have to use some services like transports!” True, but not directly to the State. Public transportation is a huge structure with thousand of employees. A State is not in the condition to take care of the railway system. It’s too often too bing and there are other more important things to invest the money on. The money are not unlimited and they have to be spent wisely, setting some priorities. So, a coutry does the only thing it can do: it gives the maintenance and the optimisation of the transport system to a private third party. In this way, a State gives up on part of the money from the tickets sell, but it doesn’t pay the massive costs of maintenance and salaries.
However, they can’t do everywhere. Defence, Healthcare, School System are three sector, for example, where the privatization is very hard. Those three strategical sectors need to be controlled by the State. For a private, profit is crucial. So, less cost and a lot of income. Which means poor quality service. Think about if the Army has to defend the country, but it can’t, because they are not prepared enough, due to a lack of investments in the equipment or in the training?
So, to be clear: a State has too much cost, but it doesn’t make money selling anything. How can a State afford all the services?
Taxes as the only income source
A State asks to all the citizens, who have a work, to give part of their income to finance all the provided services. Taxes is the ONLY stable income a State has to make all the services work properly. Yes, there are people who invest in the country, buying government bonds, for example (when they are on sale), but this income is too small and not stable at all. If you want that your country works properly, you have to pay taxes.
Yes, you may hate the fact that a relatively big part of you income will not be in your bank account, but here is the thing: do you want road in perfect shape? Do you want that your trash is picked up in the morning, that the Police protects and controls the street or that the criminals are in jail? All this things are paid by your taxes. End of the story. You can complain as much as you want. The matter of fact is that without taxes, there woul be no police, no hospital, no schools, too much garbage on the street and criminals would be allowed to do whatever they want. Laws would not be a thing, because senators and deputy were not there to make laws, be cause the State could not pay them.
Taxes must be paid, if you want a country that works. You can complain about the fact that they are maybe too high compared to your salary. Or you can say “politic steals my money!” That’s correct and you have to tell your disappointment if you feel that the taxes are too high, your income too low and when your money are not very well spent. But not paying taxes is bad, because without your money, the country will not work as it supposes to. Think about it! A State works only if we go in the same direction!
Next time you pay taxes, be happy!