Taxes that are based on how much money a person earns are called income taxes.
There are many other sorts of taxes on businesses and property.
Now most countries have some sort of income tax. It is usually only for people who live in the country. How it is done varies a great deal both between countries and over time. Income tax can only work in a money economy, with reasonably accurate accounts and in an orderly society with reliable records. Income tax is generally worked out a percentage of a persons income. There may be an amount of income which is not taxed. The rate may be higher for people who have income above a set amount. It is usually worked out on a yearly basis.
For people who are employed the income tax is generally taken out of their pay by their employer who pays it to the government. People who run their own business have to produce accounts.
The first modern income tax was started in 1799 in Great Britain by Prime Minister William Pitt the Younger in his budget of December 1798, to pay for weapons and equipment for the French Revolutionary War. Pitt's income tax began at 2 old pence in the pound (1⁄120) on incomes over £60 (worth about £5,500 in 2019), up to 2 shillings in the pound (10%) on incomes of over £200. Pitt hoped that the new income tax would raise £10 million a year, but in1799 it only raised a little over £6 million.
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