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Comparison Between The US And Netherlands

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Introduction:
This essay presents a comparison between two legal systems; the United States (hereinafter US) and the Netherlands (hereinafter NL), and their approaches to income tax.

The NL a is civil law country and it is part of the European Union (EU). However, in short, the direct taxation, consequently income tax, remains the sole responsibility of member states. The NL can be placed within the framework of a parliamentary representative democracy and a decentralized unitary state. The NL is governed as a single power in which the central government is supreme and any administrative divisions exercise only the powers that the central government chooses to delegate.
In contrast, the US is a common law country and is a federal republic …show more content…

In addition, it has aspects of a scheduler tax system, because it’s another separate source of income with its own regime. The income is levied on the taxable income of an individual, which is assessed each year. Capital gains are not taxed separately but treated as taxable income. Individuals who are residents of NL must tax on their worldwide income.
The US is characterized by a global definition of income that is a comprehensive system for taxing capital gain. It is a classical corporate tax system, and has a single law for corporate and individual income tax that has a world-wide jurisdictional approach based on citizenship and residence. This approach uses foreign a tax credit system for granting relief form internal double taxation. Moreover, the US income tax system is considered progressive, as is that of the …show more content…

This provision says that only the legislature has the power to lay taxes. Any tax may be unconstitutional if it does not provide for the common defence and general welfare. Furthermore, a tax should not violate any other constitutional rights or interests, e.g.: property or equal protection rights. The 16th amendment allows income taxation without apportionment and specifically provides that congress has the power to collect taxes on income from whatever source desired. Article 1, Section 7, Clause 1 is the ‘origination clause’ that requires tax revenue bills to originate in the House of Representatives. The 5th and 14th amendments establish limits on federal and state taxing authority (e.g.: prohibit deprivation of property without due process and guarantee equal protection of the law.

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