Preface

On correlation between Bangladesh taxation system and social securities offered by the state.
Taxation is a levy on individual or corporate bodies by central or local government in order to finance the expenditure of that government and also means of implementing its fiscal policy. A tax "is not a voluntary payment or donation, but an enforced contribution, exacted pursuant to legislative authority" and is "any contribution imposed by government whether under the name of toll, tribute, impost, duty, custom, excise, subsidy, aid, supply, or other name." To tax is to impose a financial charge or other levy upon a taxpayer by a state or the functional equivalent of a state such that failure to pay is punishable by law. Taxes are also imposed by many sub-national entities. Taxes consist of direct tax or indirect tax, and may be paid in money or as its labor equivalent. Social Security means that Government, which is the symbol and representative of society is responsible for fixing a minimum standard of living for all its citizens. Social Security is an instrument for social transformation and progress and must be preserved, supported and developed as such. Furthermore, far from being an obstacle to economic progress, as is all too often said, social security organized on a firm and sound basis will promote such progress, since once men and women benefit from increases security and are free from anxiety for tomorrow, they will naturally become more productive. A comprehensive social security system has been developed covering all eventualities from conception and birth till death like pre-natal and maternity benefits, paid leave, medical care, pensions, unemployment benefits, family allowances and old age pensions, etc. The tax system is at the heart of an effective state. Taxes, raised in ways that encourage economic growth and promote political accountability, build the political legitimacy of the state and offer the eventual exit strategy from aid. Effective tax systems are central also to the Monterrey Consensus, by which developing countries committed themselves to improve their tax efforts in order to mobilize the domestic resources required for poverty reduction. Taxation one of the major sources of public revenue to meet a country's revenue and development expenditures with a view to accomplishing some economic and social objectives, such as redistribution of income, price stabilization and discouraging harmful consumption. It supplements other sources of public finance such as issuance of currency notes and coins, charging for public goods and services and borrowings. Tax is a contribution

exacted by the state. It is a non-penal but compulsory and unrequited transfer of resources from the private to the public sector, levied on the basis of predetermined criteria. The objectives of tax can be identified as Collection of revenue, Redistribution of income, Economic control, Protection of industry, Economic development, Full employment and Rising national income. Money provided by taxation has been used by states and their functional equivalents throughout history to carry out many functions. Some of these include expenditures on the enforcement of law and public order, protection of property, economic infrastructure (roads, legal tender, enforcement of contracts, etc.), public works, social engineering, and the operation of government itself. Governments also use taxes to fund welfare and public services. A portion of taxes also go to pay off the state's debt and the interest this debt accumulates. These services can include education systems, health care systems, pensions for the elderly, unemployment benefits, and public transportation. Energy, water and waste management systems are also common public utilities. Social Security is one of the important dimensions of the development process. It assumes a place of special significance in the developing countries, where poverty, destitution and income inequalities abound in large measure. In Bangladesh, an individuals income is taxed by means of an Income Tax while corporate pay a Corporation Tax. Increased in individuals wealth are taxed by Capital Gain Tax and by Inheritance Tax. Govt. needs revenue for defense, administration and development activities. The main source of this revenue is tax. For this reason a person/ corporation/ local authorities etc. should pay tax regularly. This research evaluates correlation between Bangladesh taxation system and social securities offered by the state. A theoretical analysis has been done to evaluate Bangladesh taxation system; on the other hand, a comparative study with other countries such as India, Malaysia & Nepal has to make to evaluate social securities offered by the state. Socio-economic effects of tax evasion and tax avoidance are loss of Government revenue, development of vicious cycle of tax evasion and unwarranted use of tax-evaded income. All the governments of BANGLADESH so far have failed to ensure facilities for even the minimal level of living standard to its citizens or facilities for its local business organizations. Government itself is deep down in corruption. Government services to people

are too poor! We don't have good roads, we don't get adequate water supply, we don't get electricity, we don't have security... and these don'ts seem like making an endless list. And even if you go to pay for these minimal services managed by government, you would face thousands of hassles. And after you pay tax, believe it or not, a portion of it would go to the corrupted officials. Despite all these facts, as a good citizen, it is your and my duty to pay our tax duly. So, let's learn a little about tax. The triple challenge facing social security in developing countries like Bangladesh is to reduce absolute poverty and provide basic services to the population; to meet contingency needs; and to assist the victims of natural disasters and social calamities. The first priority is to ensure adequate nutrition, basic health care, primary education, clean water, decent sanitation and shelter for all. The second category of needs relates to contingencies such as sickness, accident, death of the principal breadwinner, disability and old age, as well as assistance to vulnerable groups such as abandoned children and widows. The third task is disaster relief for the victims of floods, droughts and earthquakes that destroy property, livelihood and sources of support. Despite the increasing frequency of such calamities, very little attention has been given to ways and means of compensating people for loss of property and ensuring their livelihood. Causes of low tax in GDP:
We are not very much conversion. We dont easily understand the rules and regulation of tax. Lacking of knowledge is a factor. We intentionally want to pay less tax. Corruption makes people adopting malpractice.

Lack of inspiration is also responsible. As we are living in a civilized society - should come forward to pay taxes to government in order to conduct the administrative, defense and development activities of the country. Table: Comparison of Expenditure on Social Security Benefits as % of GDP
COUNTRIES Poverty * (% of Expenditure on Social Security

Total Population) (1995) INDIA BANGLADESH PAKISTAN SRILANKA 35 46 29 22

Benefits as % of Gross Domestic Product (GDP) (1993) 0.3 0.02 0.2 2.5

The main objective of this study is to identify all other problems of Bangladesh taxation system and find out the effective way of removing all of these problems as well as to evaluate social securities offered by the state are standard or not. It is a descriptive as well as analytical research. Correlation, regression equation, test of hypotheses, trend percentages analysis and growth rate analysis have been followed for secondary data analysis. The opinion of people of Bangladesh about social securities offered by the state has been analyzed and the opinion of tax experts/authority about tax system & collection has also been analyzed.