Essay Auditing and Assurance an Intergrated Approach

1352 Words Feb 24th, 2014 6 Pages
UNIVERSITY OF SWAZILAND
Institute of distance education

ECON 104 Assignment 1

Maphuzu Dlamini
138176
Diploma in Commerce
Level 2
28 January 2012
Question 1
Taxation in Swaziland
Definition
This is the compulsory transfer of funds from the private sector to the public sector also known as the fiscal levies. They are a form of government finance in order to finance economic and social objectives of the country. The forms of taxation in Swaziland
Taxation can either be direct or indirect. Direct tax is the one levied on income or corporate profits .Namely income tax .Whereas indirect tax is the one levied on goods and services such as the sales tax or value –added tax and customs and excise duties. So as they are explained below; a)
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* To facilitate trade. c) Income tax; this is primarily based on the source principle. This is payable by both the company and individuals based on their earnings (PAYE) and profits. This includes graded tax and administered casino levy. Income tax is sub-divided as follows; * Pay as you earn (PAYE)-this is deducted from an employee’s income and remitted monthly to SRA. * Corporate tax- this is payable based on company profits. Companies are required to make a tax return by no later than 31st October annually. It is a specific percentage on their profits. * Provisional income tax-businesses are required to make provisional payment twice annually. * Self-employment and individual income tax- here self-employed individuals are required to make an annual tax return. * Withholding taxes –these are taxes on income imposed at source .A third party is charged with the responsibility of deducting the tax from specified types of payments and remitting the tax to SRA.

Sources of government funding
Other than taxation there are various methods the government attains revenues in order to help the growth and the development of the country. As for taxation SRA was launched as tan agency fit to collect government revenues. They are as follows:

I. Borrowing-government can spend more than what is implemented on the budget or more than his tax receipts. Resulting to a deficit. Government borrows in order to secure his finances .With the recent

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