Unit VIII Ch-12 Government Taxation

I. Taxation Purpose Collection and Spending Raise revenue to pay the cost of government Services Collection and Spending Budget President, OMB, & Congress, request from exec. Dept. Balance & surplus, deficit

Character of a Fair Tax 1. Based on ability to pay 2. Equal to everyone 3. Easy to pay 4.Collected at a convenient time

Dept. of Treasury Priority List what is important Exec. Dept. Treasurer IRS Priority List what is important Exec. Dept. http://www.irs.gov/ http://www.nps.gov/phso/sources/govern.htm

II. Incomes Sources for Governments Federal Government Personal Income Tax Largest source Exemption, deductions, taxable incomes Voluntary Compliance Corporation Income Tax Second largest source Profits

Estate, Gift, Inheritance Bonds Excise Tax Luxury items (yachts, cars, etc.) Tariffs Imported goods Estate, Gift, Inheritance Bonds http://www.irs.gov/businesses/small/article/0,,id=99517,00.html http://www.usitc.gov/tata/hts/ http://www.publicdebt.treas.gov/sav/sav.htm

State Government Federal Government Sales Tax Personal income Corporation Income Tax License & Fees

Harry G. Smith Tax Administrator/Collector Local Government Federal & State Government Property Tax License & permits Fines Services Provided Federal Government State Government Harry G. Smith Tax Administrator/Collector

III. Effects of Taxation & Gov’t Spending on Economy Government Spending Short term Long term Taxation http://www.whitehouse.gov/omb/budget/fy2005/

Why the Cost of Gov’t has risen. 5 Reasons Larger population Cost of items ha gone up Size of Gov. has grown (more services) Defense Spending Nat’l Debt has risen