Investopedia defines income tax as a tax that governments impose on financial income generated by all entities within their jurisdiction.
Investopedia goes on to say:
“By law, businesses and individuals must file an income tax return every year to determine whether they owe any taxes or are eligible for a tax refund. Income tax is a key source of funds that the government uses to fund its activities and serve the public. Most countries employ a progressive income tax system in which higher income earners pay a higher tax rate compared to their lower earning counterparts.”
See also Taxation.
Investopedia, Income Tax, at http://www.investopedia.com/terms/i/incometax.asp, accessed 11 May 2016.
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Page created by: Ian Clark, last modified on 11 May 2016.
Image: SeeTaxSolutions.com, at http://newbusinesscreator.com/how-a-c-corp-can-avoid-double-taxation-when-selling-a-business/, accessed 11 May 2016.