Question

What is the benefit of having state and local taxes on income instead of collecting all such taxes at the federal level?

Short answer

The benefit of having state and local taxes on income instead of collecting all such taxes at the federal level is the benefit of having state and local taxes on income instead of collecting all such taxes at the federal level.

Step-by-step solution

Concept of tax.

A tax is a mandatory levy imposed by the government on various goods and services for an individual (known as a taxpayer) who is a legal entity. Tax avoidance or evasion is a criminal violation.

Explanation of solution.

The government's primary source of revenue is income tax. Tax revenue is frequently used to aid in the development of the people. When governments or city municipalities collect the taxes, they can efficiently use the funds to boost the local population. The federal government, on the other hand, will divert the funds to other purposes rather than allocating them to a specific town in need of financial assistance.