Tax supporting the productive sectors

2/29/2016 0:00

BAGHDAD - Imad Emirate
Economic Academy of the Faculty of Administration and Economy said Mustansiriya University: Many countries resort to protect domestic industries that no longer be able to compete with imported industries, which leads to raise the prices as there are conditions that rival the best of manufactured goods locally.

He said the academic d. Ammar Majid Kazem in an interview with «morning» used a number of tax countries as a means to encourage economic sectors such as tourism, industry or agriculture, so she exempting those activities from taxation.

Revitalization of the economy

Kadhim said that the tax is one of the important tools resorted to by the state to stimulate the economy in each of the cases of inflation and deflation and recession. In periods (recession and deflation), which are a feature of the modern economic system attributes, with less purchasing and consumption and piling products, the government is increasing the purchasing power of the people with low incomes, by reducing the income tax rate in the first of their parts, and raising the amount of the tax exemption, increase family exemptions and reduced rates of indirect taxes, particularly relating to the basic needs of citizens such as bread, tea, milk and dairy products.

He continued in a period of prosperity and inflation could use tax economic means, by reducing government spending and raising taxes on incomes and goods to ease the purchasing power of individuals and to curb private spending, and lower taxes on capital and savings to give impetus to projects production would contribute to lower prices, these measures should be be part of an integrated economic policy, but not isolated tax measures.

Encourage investment

He stressed the possibility of imposing a tax in order to encourage investment in certain sectors or reduce it in other sectors, if the state deems that there is a need to encourage a particular sector, they resort to fully relieved of the tax rate or reduce the tax ratio
on him.

The importance of taxes

And: this in turn works to stimulate investment in this sector, because the cancellation of the tax or reduction of working to increase the interest earned by the investor, and the contrast could resort state to impose a high tax rate on sectors that feel increase investment for the needs of society, leading to a decline in investment these sectors and direct them to other sectors less investment, for example, raise taxes on luxury industries and reduction in return on industries

Special taxes

He pointed out that taxes are used to prevent the concentration of economic projects that has become characteristic of this era, particularly the capitalist system, and the emergence of multinationals, but a manifestation of economic concentration, explaining can use the tax as a way to fight this concentration, and this is done by imposing a special tax exposure at each stage of production in the flying companies around the bloc, which increases the cost of producing this item, and limits the phenomenon of concentration.

He concluded d. Ammar used Alastosmaralamala tax to encourage saving, and this is done when the state exempt development revenue bonds issued by the state taxes to encourage such bonds, or tax on deposits reduction in provident funds or any other financial investment supports the national economy.