A tax should be economical with the cost of collection representing only a small part of the revenue raised. A tax should not act as a disincentive and stop people from working. A tax should be flexible so that the government can use tax changes to help control the level of demand in the economy. Main Types of Taxation Income tax . 17.5 per cent is added onto the selling price of most non-essential goods and services.
Duties are taxes on the sale of luxury goods.
A fixed amount is added to the selling price. Council Tax is a local tax on property. All properties are valued and the amount of council tax paid depends on the value band which the property falls into. Corporation tax is a tax on company profits. Petroleum revenue tax is a tax on oil taken from the North Sea.