What is Tax or Tax Law?

What Does Fiscal or Tax Law Mean

Tax law or tax law is a branch of financial law dedicated to the study of the rules that establish and apply taxes or tributes. In other words, it is the study of the taxing power of the State , that is, its mechanisms for obtaining income to finance public spending, that is, public investments for the common good .

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Commonly, tax law is interested in the material (physical) or procedural (formal) aspects contemplated in the legal system of tax matters of a country. It also refers to the set of exceptions, sanctions, protocols and specific provisions through which the tax obligation is administered each year.

In that sense, two different branches can be distinguished within tax law, which are:

  • The material tax law. That deals with the legal norms that sustain the tax discipline of a nation .
  • Formal tax law. That he is interested in the series of steps and norms that the State must follow to pay the tribute.

The difference between these two branches is flexible and is not strictly drawn, since both are part of the same legal and legal framework.

See also: Branches of law

History of fiscal or tax law

Since ancient times, the human being has organized into societies orchestrated by a central power . That power was held by the pharaoh, the king, the high priest or, later, the feudal lords or the Catholic Church itself.

In different ways, each one served to organize the community politically, socially and economically . That is why the ruler was always the recipient of the tributes or taxes that were collected, often in a forced and violent way, from the masses of workers .

In ancient Egypt, for example, the tribute to the pharaoh was an obligation whose breach was fiercely punished. Later, in the Roman Empire, tribute was formally consolidated and the first and primitive forms of tax law emerged.

After the entry into modernity and the construction of the democratic, secular and liberal republics of the West, the tribute passed into the hands of the State, administered by the government of the day. Today it consists of capitals , no longer in species (portions of production) as in ancient times.

Principles of fiscal or tax law

The principle of uniformity implies that whoever earns the most also pays more.

Tax law is governed by the following general principles:

  • Tax legality . Under the premise nullum tributum sine lege , that is, "there is no tax without law", this principle establishes that taxes can only be issued by a legally constituted power, that is, endowed with legitimacy and explicit authorization by the whole of the society. In the same way, it establishes that no tribute may be established in a way that violates the law in the least.
  • Obligatory nature of the tribute. As its name indicates, this principle dictates that the tribute is an obligation, from which no ordinary citizen is exempt, and does not depend on the individual's willingness to pay. In this sense, the collective desire is imposed on the individual, to ensure compliance with the law. The exceptions to this principle will only be provided in the law that establishes it.
  • Tribute justice. According to this principle, all the people who make up the company have the obligation to contribute to its maintenance, through the tax strategies that the State dictates. Said contribution, however, must be made fairly, taking into account their respective income and capacities, so that the tax burden is distributed equitably throughout society.
  • Uniformity of the tribute. Protected by the notion of legal equality, this principle allows a certain “tax inequality” that requires more contributions due to the same tax to those who earn the most within a society.
  • Tribute advertising. This principle establishes, in simple words, that tax matters must be public, that is, they must not have room for secrets or private transactions, but that everything must be done under the full gaze of others, to minimize the margins of corruption. and ensure compliance with the above principles.
  • Tribute certainty. According to this principle, it is not enough for the law to create the tax, but it must also be accompanied by all the necessary provisions for its regulation, control and implementation, thus ensuring that there is the greatest possible certainty regarding its operation.
  • No confiscation of the tribute. This principle is established to ensure that the State cannot attempt, through tax, against private property . That is why it dictates that the tax paid for a good or service cannot be equivalent to the whole good or service, since that would be equivalent to its confiscation by the State.
  • Collection economy. Although the State is able to create and administer taxes, according to this principle it can do so only for the purpose of guaranteeing its own existence and maintenance, not for enrichment purposes of any kind. For that reason, it will not be able to demand from citizens more than what is strictly necessary to continue operating.

Sources of fiscal or tax law

The sources of tax law are generally limited to what is established by the Doctrine, that is, to the formal provisions contemplated in laws, regulations, decrees, international treaties and jurisprudence . All this within the legal framework established by the Magna Carta or National Constitution.

It can help you: Sources of Law

Taxes

We call taxes or tributes to a series of monetary obligations established by law , through which all citizens contribute to the maintenance of the State. Said obligation is established by law in the legal system itself.

Its compliance can and must be exercised by the State, empowered by the law itself to exercise a proportional punishment in the event that a citizen fails to comply with it. The purpose of these taxes is to guarantee the possibility of existence of the State and of the social pact that through its laws and decrees guarantees.

Tax types

Broadly speaking, the tributes can be classified into:

  • Taxes on income, profits and capital. That is, amounts calculated from the non-salary income of citizens.
  • Contributions to social security. These are portions of the salary of workers that are allocated to the Social Security System that exists in your country, which you may have in case of health emergencies or in the form of a retirement pension when the time comes.
  • Taxes on labor. Through which the State taxes the owners of large businesses and companies .
  • Taxes on the property . Calculated in such a way that those who possess more assets than is strictly necessary contribute proportionally to the State.
  • Taxes on goods and services. Through which the State receives a portion of the money destined for a purchase, rental or commercial operation that is carried out.
  • Other taxes. Destined to assess certain conditions, events or companies.
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