Taxes affect business on all the financial levels in its operations.
As all businesses rely on income and growth, taxes will have a direct and indirect impact on this. Certain countries will have tax laws that make it difficult for businesses to grow, while other countries will have tax laws that make it easier for them to grow.
Itâ€™s important as a business to understand the requirements of the taxation laws as a slight misunderstanding can result in business failure.Think of finance management, it has to be precise in order to pay correct taxes. Thus in itself requires funs, thus driving up the need for more income and in turn driving up the payment of tax. In this sense tax has some potential to motivate a business toward growth.
On a second note, a business needs profit to sustain its growth. Depending on the tax laws, this can make certain business thrive while others struggle to compete against the market giants.
Either way, tax will have a negative or positive impact on businesses.
Some negative impacts include:
Some positive outcomes are:
In a similar way, tax can also go on to affect people on a personal level. A business that is thriving will grow to employ people providing jobs. Likewise, a business under taxation pressure may collapse costing people jobs.