Tax as the main source of increasing budget revenues

Abstract

Tax policy is of great importance in the formation of budget revenues, and tax revenues constitute the main part of budget revenues in Azerbaijan. What should be understood byeffective tax policy in general? As already mentioned, tax revenues are a part of budget revenues. As a result, more tax revenues mean more budget revenues. However, it should be taken into account that 
raising taxes beyond a certain limit can have a negative impact on both economic growth and the business environment. Effective tax policy involves such policy measures that, while ensuring budget revenues, do not have a sharp negative impact on economic development. Like the public financing structure, increasing debt is nothing more than an increasing burden on the economy. One way to mitigate this problem is to adjust the tax system in such a way that the tax rates applied provide the maximum possible revenue for the government without having a disincentive effect on the economy. In this regard, the level of personal income taxes and the overall efficiency of the system are always among the most discussed topics in scientific and social fields.