TAXATION
Group 7


Vocabulary

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Tax (n) [taeks] : a compulsory contribution to state revenue, levied by the
government on workers' income and business profits or added to the cost of some
goods, services, and transactions – thuế
Impose (v) /im'pouz/ : to establish or apply as compulsory
Taxation (n) /tæk'seiʃn/ : the act or principle of levying taxes or the condition of
being taxed
Tax evasion : the illegal nonpayment or underpayment of tax.
Inheritance (n) /in'heritəns/ : a thing that is inherited.
Dissuade (v) /di'sweid/ : persuade (someone) not to take a particular course of
action.

Deduct (v) /di'dʌkt/ : subtract or take away (an amount or part) from a total.
Progressive tax (n) : income tax that takes a larger percentage of a larger income
and a smaller percentage of a smaller income
Tax liability (n) : debt to a government incurred by a tax payer as accrued or
asessed taxes
Tax bill (n) : money owed for taxes
Loophole (n) /loo͞opˌ(h)ōl/ : a means of escape or evasion
Tax shelter (n) : A financial arrangement, such as the use of special depletion
allwances, that reduces taxes on current earnings
Tax inspector (n) : an official responsible for assessing and collecting income tax
and some other taxes
Regressive tax (n): taxation that takes a larger percentage of a lower income and
a smaller percentage of a higher income


VOCABULARY EXERCISES
1. Find words in the text that mean the following








1 reducing the value of a fixed asset, by charging

Depreciation

it against profits

Disincentive

2 something which discourages an action

Regressive

3 an adjective describing a tax that is proportionally
higher for people with less money
Consumption

Self-employed

4 spending money to buy thugs, rather than saving it
5 working for yourself, being your own boss

6 a tax on incomes that pays for sickness benefit,
unemployment benefit, and old-age pensions

National insurance






Perks
Tax-Shelter

7 non-financial benefits or advantages of a job
8 a way to delay the payment of tax on a later

time

9 an adjective describing expenditures that can be
taken away from taxable income or profits
Tax-deductible

Tax haven

businesses

10 a company offering very low tax rates to foreign


VOCABULARY EXERCISES
2. Which terms do the following sentences define?

1. The tax people pay on their wages and salaries is called
A capital transfer tax B income tax C wealth tax



Answer: B (Thuế thu nhập cá nhân)

2. A tax on wages and salaries or on company profits is a/an



A direct tax

B indirect tax


C value-added tax

Answer: A (Thuế trực thu)

3. A tax levied at a higher rate on higher incomes is called a
progressive tax
 AAnswer:
A (Thuế lũy tiến)

B regressive tax C wealth tax

4. A tax paid on property, sales transactions, imports, and so on is a/an
direct tax
 AAnswer:
B (Thuế gián thu)

B indirect tax

C value-added tax

5. A tax collected at each stage of production, excluding the already-taxed
costs from previous stages, is called a/an
added-value
tax
 AAnswer:
C (Thuế giá trị gia tăng)

B sales tax


C value-added tax


VOCABULARY EXERCISES
2. Which terms do the following sentences define?

6. Profits made by selling assets are generally liable to a
A capital gains tax



B capital transfer tax C wealth tax

Answer: A (Thuế trên thặng dư vốn)

7. Gifts and inheritances over a certain value are often liable to a
A capital gains tax



B capital transfer tax C wealth tax

Answer: B (Thuế chuyển nhượng vốn)

8. The annual tax imposed on people’s fortunes (in some countries) is a/an
A added-value tax



B capital transfer tax C wealth tax


Answer: C ( Thuế tài sản)

9. Making false declarations to the tax authorities is called
A fiscal policy



B tax avoidance

C tax evasion

Answer: C (Trốn thuế) (illegal)

10. Reducing the amount of tax you pay to a legal minimum is called
A creative accounting



Answer: B ( Tránh thuế ) (Legal)

B tax avoidance

C tax evasion


READING




Most of the money run the Government comes from taxes of all sort – on personal and
corporate income, on sales of goods, on imports and on inheritances. The ultimate source of all
tax money is the same – people



The primary function of taxation is, of course, to raise revenue to finance government
expenditure, but taxes can also have other purposes. Indirect excise duties, for example, can
be designed to dissuade people from smoking, drinking alcohol, and so on. Governments can
also encourage capital investment by permitting various methods of accelerated depreciation
accounting that allow companies to deduct more of the cost of investments from their profits,
and consequently reduce their tax bills.


Translate
Most of the money run the Government
comes from taxes of all sort – on personal
and corporate income, on sales of goods,
on imports and on inheritances. The ultimate
source of all tax money is the same – people
A. The primary function of taxation is, of
course, to raise revenue to finance
government expenditure, but taxes can
also have other purposes. Indirect excise
duties, for example, can be designed to
dissuade people from smoking, drinking
alcohol, and so on. Governments can also
encourage capital investment by permitting
various methods of accelerated
depreciation accounting that allow

companies to deduct more of the cost of
investments from their profits, and
consequently reduce their tax bills.

Phần lớn nguồn thu để chính phủ hoạt động
đến từ các loại thuế - thuế thu nhập cá nhân
và doanh nghiệp, thuế doanh thu bán hàng,
thuế nhập khẩu và tài sản thừa kế.Người dân
là đối tượng chịu thuế cuối cùng của tất cả
các loại thuế trên
Chức năng chủ yếu của thuế tất nhiên là
phục vụ cho các hoạt động chi tiêu của chính
phủ, tuy nhiên việc đánh thuế vẫn có nhưng
mục đích khác. Ví dụ thuế tiêu thụ đặc biệt
gián tiếp có thể được thiết kế để khiến người
dân giảm tiêu thụ thuốc lá, rượu bia, vân
vân. Chính phủ cũng có thể khuyến khích gia
tăng vốn đầu tư bằng cách hợp pháp hoá
nhiều phương pháp khấu hao nhanh cho
phép các công ty khấu trừ nhiều chi phí đầu
tư hơn từ lợi nhuận, và từ đó giảm đi mức
thuế phải chịu


Translate
Most of the money run the Government
comes from taxes of all sort – on personal
and corporate income, on sales of goods,
on imports and on inheritances. The ultimate
source of all tax money is the same – people

A. The primary function of taxation is, of
course, to raise revenue to finance
government expenditure, but taxes can
also have other purposes. Indirect excise
duties, for example, can be designed to
dissuade people from smoking, drinking
alcohol, and so on. Governments can also
encourage capital investment by permitting
various methods of accelerated
depreciation accounting that allow
companies to deduct more of the cost of
investments from their profits, and
consequently reduce their tax bills.

 T. The primary function of taxation is, of course, to raise revenue to finance
government expenditure, but taxes can also have other purposes. Indirect
excise duties, for example, can be designed to dissuade people from smoking,
alcohol, and so on.
1.drinking
Taxes
can be designed both to

discourage and to encourage spending.


Reading

•

There is always a lot of debate as to the fairness of tax system. Business profits, for

example, are generally taxed twice: company pay tax on their profits (corporation tax
in Britain, income tax in the USA), and the shareholders pay income tax on dividends.
Income taxes in most countries are progressive, and are one of the ways in which
governments can redistribute wealth. The problem with progressive taxes is that the
marginal rate – the tax people pay on any additional income – is always high, which is
generally disincentive both working and investing. On the other hand, most sales
taxes are slightly regressive, because poorer people need to spend a larger proportion
of their income on consumption than the rich


Translate

B. There is always a lot of debate as to the
fairness of tax system. Business profits,
for example, are generally taxed twice:
company pay tax on their profits (corporation
tax in Britain, income tax in the USA), and the
shareholders pay income tax on dividends.
Income taxes in most countries are
progressive, and are one of the ways in
which governments can redistribute
wealth. The problem with progressive taxes
is that the marginal rate – the tax people
pay on any additional income – is always high,
which is generally disincentive both working
and investing. On the other hand, most sales
taxes are slightly regressive, because
poorer people need to spend a larger
proportion of their income on consumption
than the rich


Luôn luôn có rất nhiều tranh cãi về tính
công bằng của hệ thống đánh thuế. Ví dụ : lợi
nhuận kinh doanh thường bị đánh thuế 2 lần:
công ty chịu thuế trên lợi nhuận( thuế doanh
nghiệp ở Anh, thuế thu nhập ở Mỹ), và các cổ
đông chịu thuế trên cổ tức. Hầu hết các quốc
gia hiện nay thực hiện đánh thuế thu nhập
luỹ tiến, và đây cũng là một cách để chính
phủ phân phối lại của cải trong xã hội.Vấn đề
với thuế thu nhập luỹ tiến đó là thuế suất
biên – phần thuế mà người dân phải chịu trên
các nguồn thu nhập ngoài khác – luôn luôn
rất cao, điều này sẽ kìm hãm sự phát triển
của cả sản xuất và đầu tư. Mặt khác, hầu hết
các loại thuế bán hàng đều là thuế luỹ thoái,
bởi vì so với người giàu những người nghèo
thường phải giành một tỉ lệ lớn hơn từ thu
nhập của họ cho sinh hoạt phí


Translate


B. There is always a lot of debate as to the
fairness of tax system. Business profits,
for example, are generally taxed twice:
company pay tax on their profits (corporation
tax in Britain, income tax in the USA), and the
shareholders pay income tax on dividends.

Income taxes in most countries are
progressive, and are one of the ways in
which governments can redistribute
wealth. The problem with progressive taxes
is that the marginal rate – the tax people
pay on any additional income – is always high,
which is generally a disincentive to both
working and investing. On the other hand,
most sales taxes are slightly regressive, an
because poorer people need to spend a
larger proportion of their income on
consumption than the rich

T. Business profits, for example, are generally taxed twice: company pay tax on
their profits (corporation tax in Britain, income tax in the USA), and the

pay income
on dividends.
2. shareholders
The same amount
oftax
money
can be taxed more than
once

3. Progressive taxes may discourage people from working

T. The
problem with progressive taxes is that the marginal rate – the tax
extra

hours
people pay on any additional income – is always high, which is generally a
disincentive to both working and investing.

4. Sales taxes are unfair because poor people spend more
than the rich



F. Most sales taxes are slightly regressive, because poorer people need to
spend a larger proportion of their income on consumption than the rich.


READING


The higher the tax rate, the more people are tempted to cheat, but there is a substantial ‘black’ or ‘underground’
economy nearly everywhere. In Italy, for example, self-employed people – whose income is more difficult to
control than that of company employees – account for more than half national income. Lots of people also have
undeclared part-time evening jobs (some people call this ‘moonlighting’) with small and medium-sized family
firms, on which no one pays any tax or national insurance. At the end of 1996, the Director of the Italian National
Institute of Statistics calculated the size of the underground economy, and added 16,7% to Italy’ gross national
product (GNP) figure, and then claimed that Italy had overtaken Britain to become the world’s fifth largest
economy.



To reduce income tax liability, some employers give highly-paid employees lots of ‘perks’ (short of perquisites)
instead of taxable money, such as company cars, free health insurance, and subsidized lunches. Legal ways of
avoiding tax, such as these, are known as loopholes in tax law. Life insurance policies, pension plans and other

investments by which individuals can postpone the payment of tax, are known as tax shelters. Donations to
charities that can be subtracted from the income on which tax, is calculated are described as tax-deductible


Translate

C. The higher the tax rate, the more people
are tempted to cheat, but there is a
substantial ‘black’ or ‘underground’
economy nearly everywhere. In Italy, for
example, self-employed people – whose
income is more difficult to control than that of
company employees – account for more than
half national income. Lots of people also
have undeclared part-time evening jobs
(some people call this ‘moonlighting’) with
small and medium-sized family firms, on
which no one pays any tax or national
insurance. At the end of 1996, the Director of
the Italian National Institute of Statistics
calculated the size of the underground
economy, and added 16,7% to Italy’s gross
national product (GNP) figure, and then
claimed that Italy had overtaken Britain to
become the world’s fifth largest economy.

Thuế suất càng cao thì càng có nhiều người
tìm cách trốn thuế, tuy nhiên có một bộ phận
lớn của nền kinh tế được gọi là ‘thị trường
đen’ hay ‘kinh tế ngầm’ xuất hiện ở khắp mọi

nơi. Ví dụ như ở Ý, những người tự kinh doanh
– sở hữu nguồn thu nhập khó kiểm soát hơn
so với những nhân viên làm thuê – thường sở
hữu hơn một nửa thu nhập quốc dân. Rất
nhiều người cũng làm những công việc bán
thời gian vào buổi tối nhưng không hề khai
báo (hay còn gọi là công việc ngoài giờ) hay
sở hữu những doanh nghiệp gia đình cỡ vừa
và nhỏ mà không hề đóng bất cứ khoản thuế
hay bảo hiểm nào. Vào cuối năm 1996, Giám
đốc của Viện thống kê quốc gia Ý đã nghiên
cứu về quy mô của nền kinh tế ngầm, và cộng
thêm 16,7% vào tổng sản lượng quốc gia
(GNP) Italia, từ đó tuyên bố rằng Ý đã vượt
qua Anh để trở thành nền kinh tế lớn thứ năm
trên thế giới


Translate

C. The higher the tax rate, the more people
are tempted to cheat, but there is a
substantial ‘black’ or ‘underground’
economy nearly everywhere. In Italy, for
example, self-employed people – whose
income is more difficult to control than that of
company employees – account for more than
half national income. Lots of people also
have undeclared part-time evening jobs
(some people call this ‘moonlighting’) with

small and medium-sized family firms, on
which no one pays any tax or national
insurance. At the end of 1996, the Director of
the Italian National Institute of Statistics
calculated the size of the underground
economy, and added 16,7% to Italy’s gross
national product (GNP) figure, and then
claimed that Italy had overtaken Britain to
become the world’s fifth largest economy.

 T.

At the end of 1996, the Director of the Italian National Institute of

Statistics calculated the size of the underground economy, and added 16,7%
to Italy’ gross national product (GNP) figure…

5. The Italian government knows that about
one seventh of national income escapes
taxation.


Translate

D. To reduce income tax liability, some
employers give highly-paid employees lots of
‘perks’ (short of perquisites) instead of
taxable money, such as company cars, free
health insurance, and subsidized lunches.
Legal ways of avoiding tax, such as these, are

known as loopholes in tax law. Life insurance
policies, pension plans and other investments
by which individuals can postpone the payment
of tax, are known as tax shelters. Donations to
charities that can be subtracted from the
income on which tax, is calculated are
described as tax-deductible

Để giảm gánh nặng về thuế thu nhập, một
số công ty trả cho các nhân viên có thu nhập
cao bằng các khoản ‘thù lao đặc biệt’ (kiểu
như bổng lộc) thay vì trả lương bằng tiền và
phải chịu thuế thu nhập, ví dụ như xe hơi
công ty, bảo hiểm y tế miễn phí, ăn trưa
miễn phí,…. Những kiểu trả lương trên được
gọi là lách luật thuế một cách hợp pháp. Các
chính sách bảo hiểm nhân thọ, bảo hiểm hưu
trí và một loạt các khoản đầu tư khác được
các cá nhân sử dụng để trì hoãn việc nộp
thuế được gọi là các chỗ dựa để tránh thuế.
Các khoản đóng góp cho các quỹ từ thiện
được trích ra từ thu nhập bị đánh thuế được
tính là các khoản giảm trừ thuế


Translate

 F. Legal ways of avoiding tax, such as these, are known as
D. To reduce income tax liability, some
employers give highly-paid employees lots of

‘perks’ (short of perquisites) instead of
taxable money, such as company cars, free
health insurance, and subsidized lunches.
Legal ways of avoiding tax, such as these, are
known as loopholes in tax law. Life insurance
policies, pension plans and other investments
by which individuals can postpone the payment
of tax, are known as tax shelters. Donations to
charities that can be subtracted from the
income on which tax, is calculated are
described as tax-deductible

loopholes in tax law.

6. “Loopholes” are a common form of tax
evasion

7. If you pay a lot of your income into a
pension fund or a life insurance policy you
never have to pay tax on it.

 F. Life insurance policies, pension plans and other
investments by which individuals can postpone the
payment of tax, are known as tax shelters.


READING


Companies have a variety ways of avoiding tax on profits. They can bring forward capital expenditure (on new

factories, machines, and so on) so that at the end of the year all of the profits have been used up; this is known as
making a tax loss. Multinational companies often set up their head offices in countries such as Monaco, the
Cayman Islands, and the Bahamas, where taxes are low, such countries are known as tax heavens. Criminal
organizations, meanwhile, tend to pass money through a series of companies in very complicated transaction in
order to disguise its origin from tax inspectors- and the police; this is known as laundering money


Translate

E. Companies have a variety ways of
avoiding tax on profits. They can bring
forward capital expenditure (on new
factories, machines, and so on) so that at the
end of the year all of the profits have been
used up; this is known as making a tax loss.
Multinational companies often set up their
head offices in countries such as Monaco, the
Cayman Islands, and the Bahamas, where
taxes are low, such countries are known as
tax heavens. Criminal organizations,
meanwhile, tend to pass money through a
series of companies in very complicated
transaction in order to disguise its origin
from tax inspectors- and the police; this is
known as laundering money

Các doanh nghiệp sử dụng rất nhiều cách
khác nhau để trốn thuế thu nhập. Họ có thể
luân chuyển vốn sớm hơn (xây dựng phân
xưởng mới, mua máy móc mới,…) và như thế

vào cuối mỗi năm kinh doanh, tất cả lợi
nhuận đã được sử dụng hết, quá trình này
giống như việc khai báo lỗ để giảm thuế. Các
doanh nghiệp toàn cầu thì thường đặt trụ sở
chính của họ tại các quốc gia đánh thuế thấp
như là Monaco, Quần đảo Cayman, và
Bahamas, những quốc gia được biết đến như
là các thiên đường tránh thuế. Trong khi đó
các tổ chức tội phạm thường chuyển tiền qua
một loạt các công theo nhưng phương thức
rất tinh vi để che đậy nguồn gốc của các
khoản tiền, qua mặt nhân viên thuế quan và
cảnh sát; cách thức này được gọi là rửa tiền
 


Translate

E. Companies have a variety ways of
avoiding tax on profits. They can bring
forward capital expenditure (on new
factories, machines, and so on) so that at the
end of the year all of the profits have been
used up; this is known as making a tax loss.
Multinational companies often set up their
head offices in countries such as Monaco, the
Cayman Islands, and the Bahamas, where
taxes are low, such countries are known as
tax heavens. Criminal organizations,
meanwhile, tend to pass money through a

series of companies in very complicated
transaction in order to disguise its origin
from tax inspectors- and the police; this is
known as laundering money

8. FA. They
can bring forward capital expenditure (on new
company that makes an unusually large
factories,
machines,
andyear
so on) so
that at quickly
the end of the
year
profit
during
a tax
might
decide
to spend it, for example, on a new factory or
all of the profits have been used up; this is known as making
equipment.
a tax loss.


SUMMARY
A – The primary function of taxation is to raise revenue to finance government
expenditure.
– These other purposes are dissuading people from smoking and drinking alcohol;

and encouraging capital investment.
B – There is always a lot of debate as to the fairness of tax system. ( Business profits are generally
– Progressive taxes: + One of the ways in which governments can redistribute wealth
+ Problem is the marginal rate is always high.
– Regressive taxes: Most sales taxes are slightly regressive.
C – ‘Black’ or ‘underground’ economy nearly everywhere.
– Self-employed people account for more than a half of national income but are more difficult to
control than that of company employees.
D – Companies use ‘perk’ (short of perquisites) to pay the highly-paid employees instead of
– Tax shelters:
+ Life insurance polices
+ Pension plans
+ Other investments
– Donations to charities are described as tax-deductible.
E – Various ways of tax evasion:
+ Bringing forward capital expenditure (making a tax loss)
+ Setting up the head offices in countries known as tax havens.
+ Laundering money: Passing money through a series of companies in very complicated transactions.

taxed twice,…)

taxable money.


Thanks for Listening