Tax Types

         Taxes exist because the government needs money to pay for programs all individuals will not pay voluntarily(armies, roads, national parks, school, hospitals), therefore taxes control each person provides help for their country.
Taxes work under four main questions: where to tax, who to tax, how to tax, and what to tax.

                              

WHAT to tax

luxury goods(boat, fur coat, etc)
user fees such as tax on water, gas, electricity, park, toll roads)
income depending on how much the person or business earns(business, person)
property/real estate
purchases contain additional taxes(IVA 13%, sales tax 0-12%)
recreational substances sometimes set high taxes because they know people are addicted to the substance and therefore they will still buy it(sin tax tobacco alcohol etc)
gift/estate tax(money passed on after someone dies($2000+)

WHO/HOW

proportional taxing consists in a "fair" agreement in which everyone pays the same percent.
progressive"equity"tax- the wealthy are charged more taxes because they can pay more than the poor/
regressive taxing consists in taxing the poor more than rich because it distributes the burden wider because lots of poor paying a little tax will maximize revenue better than a few rich paying a lot.
flat tax consists in everyone paying the same amount of taxes.

This graph is a representation of a progressive tax. Notice how all the quintiles from lowest to fourth have very similar stats. Yet, the top quintile or the wealthy class, is drastically higher than the other four quintiles.