Benefit approach in tax collection for the state welfare : a comparative analysis

Abstract

Purpose: This study seeks to explore scientific fundamentals in tax collection. This approach is based on philosophical aspects which justify the state to collect taxes as collections that can be forced in the sense of having legal authority. Approach/Methodology/Design: The benefit approach in withdrawing taxation is the philosophical basis for tax collection in Indonesia based on the benefit approach. Findings: The benefit approach is based on the philosophy that the state creates benefits which can be enjoyed by all citizens who reside in the state. In Indonesia the taxation is based on Pancasila containing the nature of kinship and cooperation. Mutual cooperation is such a joint venture carried out without being rewarded aimed at the public interest. Based on Pancasila, tax collection can be justified because the tax payment is intended for the interests and the welfare of the people. Practical Implications: This benefit approach bases a philosophy that because the state creates benefits that can be enjoyed by all citizens who live in the country, the state has the authority to collect taxes from the people even in a forced way. Originality/value: This study conceptually combines taxation theories and their functions in state finance in a theoretical context of the benefit approach on the basis of kinship and mutualism inherent in Pancasila as justification for the use of taxes for the greatest prosperity of the people.