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.

depreciation

Depreciation is a process by which the government allows people and corporations to deduct value for "wear and tear."

Through this process, people and corporations are allowed to maximize earnings in tax bracket (stay on a lower bracket, pay less).

Whenever the government allows claims for depreciation, workers can keep a little more income in order to invest in the economy and promoting economic growth.

Depreciate also refers to the decrease in value of a currency. When a country's currency depreciates, it becomes cheaper to trade with them for other nations. A weak currency means that outside countries are more apt to affording the country's products and resources

All cars  lose about 15 to 20 percent of their value each year. So a car that's three years old will become worth about 80 to 85 percent of the value the car held as a two-year-old car. The next year, when the car is four years old, it will become worth 80 to 85 percent of the value the car held as a three-year-old car, and so on.

MONEY

        Money is the tool with human set value in which all humans revolve, being the most essential tool for survival in contemporary times. There are two types of money people work with.

M1 is the physical money like bills coins etc-FED/EU-3%  refers to all of the physical money such as dollar bills and coins. The FED/EU is in charge of this and take control of the money supply. However, physical money only makes up 3% of all money supply.

M2 is virtual money that comes in credit cards or checking accounts. The market takes control of this money supply. Since this money does not really exist, we face an ongoing and progressive debt of a system that only works because we believe in it and have not thought of a better alternative. Virtual money makes up 97% of the money supply.

FED increases and decreases money in market. They manipulate money by:

-Reserve requirement is how much money banks must keep in the vault for every deposit.

Whenever the reserve requirement is low, the money supply increases.

Whenever the reserve requirement is high, the money supply decreases.

-discount rate is the percent at which FED "sells" money to bank.

If they increase the rate, money in circulation decreases.

If they decrease the  rate, money in circulation increases. 

-open market operations are bonds sold by the government such as securities to the public.