Taxation Why is taxation is a big issue for governments? One of the things we have seeming the 1990’s is massive social problems in many countries of the world.   Basically, local government gets money from three sources: -- Local taxes of the citizens inside their political boundaries -- Fees for serves and use of facilities -- Money transfer from provincial/state and national government agencies Because the provincial/state and national government agencies are suffering taxation strain, local government is always looking for better ways to tax existing businesses and new ways to tax new business. “The new technology of the internet and the global economic changes accompanying it promise to deal a final body blow to the financial security of local governments.  Local governments could once count on local economic development to produce local jobs where local could spend money in local stores, thereby generating local tax revenue for further development. This virtuous cycle has been fatally undermined by the new technology of cyberspace.  Even as many states and local areas hope for increased revenue due to high technology-based growth, it becomes harder and harder for local government to capture much of that growth in local tax revenue.”