TAX BREAK Meaning and
Definition
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A tax break refers to a financial benefit or reduction in the amount of taxes owed by an individual, business, or other entity as authorized by the government. It is a legal provision or incentive offered by the tax authorities to encourage certain behaviors or stimulate economic growth.
Typically, tax breaks are aimed at lowering or eliminating the tax liability for specific economic activities, investments, or expenditures, thereby reducing the overall tax burden and increasing disposable income or profitability. They are commonly granted through tax deductions, exemptions, credits, or allowances, which can be applied against taxable income, profits, or taxes owed.
Tax breaks are employed as tools for various purposes, such as promoting industrial expansion, encouraging research and development, supporting charitable contributions, incentivizing renewable energy projects, boosting employment, or fostering small businesses. They aim to stimulate economic activities and incentivize behaviors that are deemed beneficial to society or deemed as contributing to the overall welfare and growth of the economy.
Governments often adopt tax breaks as part of their fiscal policy to influence economic behavior, achieve specific social objectives, attract or retain businesses, or provide relief during times of economic downturn. However, tax breaks can be controversial as they can disproportionately benefit certain individuals or corporations, potentially leading to income inequality or undesired economic consequences.
Overall, tax breaks are a mechanism employed to modify the taxation system, offering temporary or permanent reductions in tax liabilities to encourage desired societal, economic, or individual behaviors.
Top Common Misspellings for TAX BREAK *
* The statistics data for these misspellings percentages are collected from over 15,411,110 spell check sessions on www.spellchecker.net from Jan 2010 - Jun 2012.
Other Common Misspellings for TAX BREAK
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- tax vreak
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Etymology of TAX BREAK
The etymology of the term "tax break" can be understood by breaking it down into its individual components: "tax" and "break".
1. Tax: The word "tax" originates from the Latin term "taxare", meaning "to evaluate, to estimate". It entered English in the late 14th century, initially referring to the assessment or imposition of a financial burden on individuals or properties by a governing authority.
2. Break: The word "break" has Old English origins and can be traced back to the Proto-Germanic word "brekan". It originally meant to separate or divide into parts or pieces, indicating a rupture or interruption of something.
When the terms "tax" and "break" are combined, the phrase "tax break" refers to a reduction or interruption in the tax burden imposed on individuals or entities by a government. It implies a temporary or permanent alleviation or interruption of the tax obligations.
Similar spelling word for TAX BREAK
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