Sample Research Paper

A tax is usually considered as a stimulant for the economy. It is believed to ignite “economic growth” as it can encourage “desirable behavior” and discourage “unwanted behavior”. (Roach, 2007). If the government, whether local or state or federal, wants to curb alcohol drinking in the country, it would tax the companies in the alcohol industry. The price of alcohol would rise as a portion or perhaps, a major part of the tax burden levied on the organizations would be passed on to the consumers. Similarly, in addition to an increase in manufacturer’s recommended price, the government could impose a high sales tax; thereby, dissuading the consumers from buying alcohol.

On the other hand, if the government wants to promote a good, such as iodized salt, it would lower corporate as well as sales taxes. When the corporate tax would be lower, the manufacturer’s recommended price would also be not high. The sales tax on it would also below. This way, the government can encourage people to use iodized salt.

The questions which arise here is whether taxation is a means to stabilize the economy, boost economic growth and at the same time, ensure fair and equitable distribution of the nation’s wealth. Roach (2007) maintains that although taxation is generally thought of “a means to redistribute economic resources towards” “low income” and less privileged strata of society, its reality may be different and in fact, bitter. It is true that no one ever “wants to pay taxes”.

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