What is Tax?
[[File:HK IRO 08 Guide 2.jpg|thumb|220px|right|A tax form ]] [[File:Coal Tax Post no 151 - geograph.org.uk - 1151027.jpg|thumb|Marker for an area where coal was taxed]] '''Tax''' is money that people have to pay to the [[government]]. The government uses the money it gets from taxes to pay for things. For example, taxes are used to pay for people who work for the government, such as the [[military]] and [[police]], provide services such as [[education]] and [[health care]], and to maintain or build things like [[roads]], [[bridge|bridges]] and [[sewer]]s. The earliest known taxes were those of the Egyptian Old Kingdom. == Types of taxes == There are many different kinds of taxes. They may be direct tax or indirect tax. * Taxes that are based on how much money a company earns are called '''corporate taxes''' * Taxes that are based on how much money a person earns are called '''income taxes'''. * Taxes that are based on how much a person buys are called [[sales tax|'''sales taxes''']]. * Taxes that are based on how much a person owns are called '''property taxes'''. Things like houses have a [[property tax]] on them. * Taxes that are paid when official documents are approved are called [[Stamp Act|'''stamp duties''']] (because in the past the document would have a stamp put on it). Changing who owns a house will often need a document approving. * Taxes that are paid when somebody dies are called '''[[inheritance]]''' or '''estate taxes.''' Taxes can also be split into 3 groups: * '''Flat taxes''': Everybody pays the same percentage. Russia has a flat income tax and everybody in Russia has to pay 13% of the income. * '''Progressive taxes''': The more money a person makes, the higher percentage of their income they have to pay. Most countries have progressive income taxes. * '''Regressive taxes''': The less money a person makes, the higher percentage of their income they have to pay. Sales taxes are usually called regressive as poor people spend a higher percentage of their money than rich people.