TAX 316 – ETHICAL ISSUES IN TAXATION Flashcards

Vocabulary-style practice flashcards covering the ethical principles, branches, theories, and regulatory frameworks of taxation as outlined in the TAX 316 revision notes.

Ethics

The system of moral principles that guides human behaviour and determines what is right and wrong; also known as Moral Philosophy.

Ethos

The Greek word from which 'Ethics' is derived, meaning customs, habits, character, and disposition.

Descriptive Ethics

A branch of ethics that studies what people believe is right or wrong.

Normative Ethics

A branch of ethics that determines how people ought to behave.

Meta-Ethics

A branch of ethics that studies the meaning and origin of moral values.

Applied Ethics

A branch of ethics that applies ethical principles to practical situations.

DNMA

A memory aid for the branches of ethics: Descriptive, Normative, Meta-Ethics, and Applied Ethics.

Truthfulness

An ethical principle defined as being honest with yourself and others.

Autonomy

An ethical principle representing the freedom to make rational decisions.

Beneficence

An ethical principle focused on promoting good and helping others.

Non-Maleficence

An ethical principle focused on avoiding causing harm.

Justice

An ethical principle representing fairness and equal treatment.

TANBJ

A memory aid for the principles of ethics: Truthfulness, Autonomy, Non-Maleficence, Beneficence, and Justice.

Taxation Ethics

The moral principles that guide taxpayers, governments, tax practitioners and tax authorities.

Confidentiality

The ethical principle that taxpayer information should be protected.

Accuracy and Integrity

The principle that tax information should be truthful and reliable.

Tax Evasion

The illegal refusal to pay tax, involving actions like under-reporting income, false deductions, or fake records.

Aggressive Tax Avoidance

The practice of using loopholes in tax laws to reduce tax.

Transfer Pricing Manipulation

An ethical issue in taxation involving artificial pricing between related companies.

Accountability

Being answerable for one’s actions; it enforces ethics while ethics promotes it.

Horizontal Equity

A principle of fairness in taxation stating that people in similar situations should pay similar taxes.

Vertical Equity

A principle of fairness in taxation stating that higher income earners should pay more taxes.

International Business Ethics

Ethical principles guiding business activities across different countries, addressing issues like bribery and labour standards.

Civil Service Ethics

Standards of conduct expected from public servants, including integrity, accountability, and impartiality.

Corruption in Civil Service

The abuse of public office for personal gain, such as embezzlement or manipulation of tax assessments.

Absolutism

An ethical theory holding that there are universal moral standards where right is always right and wrong is always wrong.

Relativism

An ethical theory stating that morality depends on culture and circumstances.

Descriptive Relativism

A type of relativism stating that different cultures have different moral beliefs.

Normative Relativism

A type of relativism stating that no culture should judge another culture’s values.

Deontological Theory

Founded by Immanuel Kant, this theory posits that duty comes first and an action is right because it is morally right regardless of consequences.

Teleological Theory

Founded by John Stuart Mill, this theory posits that consequences matter and an action is right if it produces the greatest good for the greatest number.

Utilitarianism

The moral belief that an action is right if it produces the greatest happiness for the greatest number of people.

AAA Ethical Decision Model

A seven-step model for ethical decisions: Identify facts, identify ethical issues, identify moral principles, consider alternatives, choose the best alternative, consider consequences, and make the decision.

Tucker’s Five Question Model

A decision-making tool that asks: Is it Profitable? Is it Legal? Is it Fair? Is it Right? Is it Sustainable?

Zakat

A principle in Islam important for taxation, focused on wealth redistribution, poverty reduction, and social justice.

FIRS

Federal Inland Revenue Service; responsible for tax assessment, collection, enforcement, and taxpayer education.

JTB

Joint Tax Board; coordinates tax administration, harmonizes tax policies, and manages TIN.

EFCC

An organization that investigates financial crimes, prosecutes offenders, and combats tax fraud.

ICPC

An organization that prevents corruption, promotes transparency, and investigates corrupt practices.