Tax Law Lecture 7 by zib23319


									Tax Law Lecture 7

Krishn A Shah
   Individual Income Taxation
• It is a major source of revenue

• Most important most important source of
  government revenue
      Individual Income Tax
• Taxable Income

• Gross Income less allowable deductions
           Exempt Income
• Welfare payments
• Scholarships

• Through Convention
• Example: Vienna Convention on
  Diplomatic relations
• Structural Reasons

• Example
• Double Taxation
• Retirement Fund Contributions etc
         Employment income
• Salaries or wages
  Should we tax these as income?
• Should we tax the benefits:

• Lets examine the following and decide
  which one we should tax?

• Also, in your answers comment on
  whether any of these should receive tax
  concessions due to inflation.
                   Situation A
• Mrs. Fong receives FJD$3,333.00 every month as a
  pensioner. She is twenty two years old and got legally
  married to an ex-High court judge in January this year.
  The ex High Court Judge had served for more than thirty
  years on the bench, and was on pension. Upon his
  demise the spouse was entitled to 1/3 of his quitting
  salary as pension for life. Mrs. Fong also does part time
  dancing at one of the local bars, and receives $500 for
  every dance. On average she performs once a fortnight,
  but sometimes if there are tourist ships around then
  almost daily from Thursday to Saturday.
                    Situation B
• Mrs. Brown was in a defacto relationship for quite some
  time. She has three children from that relationship, and
  has since broken up. She recently lost her job when Air
  Fiji closed down.

• She receives $50 per child per week from an NGO, and
  $80 per month from the Social welfare. In addition she
  has applied for unemployment benefits from FNPF who
  have agreed to give her $200 per month, from her
  contributions to the extent of $4,800 or two years which
  ever occurs first. Before Air Fiji closed down on 31st April
  she was receiving a salary of $1,200 net per month.
                Situation C
• Mr. Raymond is a retired military personnel. He
  is on pension for life at FJD$2,000. In addition
  his FNPF contributions are at $400,000 and he
  has opted for pension which entitles him to
  FJD$6,000 every month. He also receives
  dividends from ATH at about $2,000 per month
  on an average yearly level. Recently he has
  started tutoring law at Laucala Campus in 2nd
  semester and his Tutoring Contract gives him a
  salary of $8,000 per semester. The contract is
  for only one semester, and he was not employed
  in semester 1.
                   Situation D
• Dave is a shoeshine boy. He receives $80 per month
  from social welfare. He earns $20 daily from shining
  shoes, and about the same from begging.

• He has also started a side business of selling BBQ’s at
  night beside hot spots in town at night. Last week he
  registered the business as “Daves BBQ.” On average he
  rakes in $50 every Thursday Friday and Saturday night.
  Sometimes he also gets tips from nightclub patrons for
  arranging companionships as he is very popular with the
  girls in the bars.

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