F4 Fiscal Policy: Taxes

3 Property Taxes

Property taxes are taxes paid on homes, land, and other property are collected by state and local are direct and proportional

Federal Revenue

The biggest part of federal revenue comes from individual income taxes.

3 tariffs

is a tax issued by the federal government on imported goods from barges from another country etc.

taxes on trade and purchases

1 sales taxes 2 excise taxes 3 Tariffs

According to the graph, how much did individuals making $20,000 to $50,000 a year pay in income taxes? According to the graph, how much revenue did the government receive from individuals earning $200,000 and above?

80 billion 480 billion

2 excise taxes OR Sin taxes

Federal and state government impose excise taxes on specific products such as: gasoline gambling cigarettes alcohol

Which phrase grants the federal government the power to collect taxes?______________________

Phrase A) The Congress shall have Power To lay and collect Taxes, Duties, Imposts and Excises

Which phrase defines the reasons why the federal government collects taxes?_______________

Phrase B) to pay the Debts and provide for the common Defence and general Welfare of the United States

Why taxes exist governments collect taxes in order to:

fund necessary programs like infrastructure ensure that citizens contribute appropriately to meeting needs in their society.

approaches to taxation: expansionary policy

occurs when the government chooses to run a larger deficit. lowering taxes increasing spending Congress can

Scenario: The government of Country Q has just implemented a new tax on goods imported from neighboring countries. The government hopes that citizens of Country Q will purchase fewer items from neighboring countries and more items produced within Country Q's borders. Based on the information provided, what type of tax has Country Q implemented? an income tax a tariff a corporate tax an excise tax

tariff

Fiscal Policy Taxes Direct is collected directly from the person or business that owes it comes from their accounts

INDIRCT tax can be collected or paid by someone else go to a store 9.99 then actually paid 10.05 its a sales tax company pays that tax later on

Background information: In 2012, President Obama and Congress debated the issue of taxes and tax cuts. In this speech, President Obama is discussing the effects of a potential tax increase. A typical middle-class family of four would see its income taxes go up by $2,200. That's $2,200 out of people's pockets. That means less money for buying groceries, less money for filling prescriptions, less money for buying diapers. . . . . . . Businesses can't afford it either. . . . Economists predict that if taxes go up on the middle class next year, consumers will spend nearly $200 billion less on things like cars and clothes and furniture - and that obviously means fewer customers. That cuts into business profits.That makes businesses less likely to invest and hire, which means fewer jobs.And that can drag our entire economy down. —President Barack Obama, November 28, 2012 Which statements best communicate the main idea of this speech? Check all that apply. Increased taxation on the middle class will improve the economy. Lower taxes increase consumer spending. Increased consumer spending strengthens the economy. Higher taxes will have a severe impact on citizens. Spending on social needs is a low priori

Lower taxes increase consumer spending. Increased consumer spending strengthens the economy. Higher taxes will have a severe impact on citizens.

Expansionary and contractionary policies can be used to encourage or discourage economic growth. Expansionary policies generally lower taxes and give consumers and producers additional money, which encourages spending and growth. This is done when unemployment is high. On the other hand, contractionary policies generally raise taxes, which can give consumers and producers less to spend. This can cause less economic growth, but is necessary when the economy is growing too quickly and inflation is rising.

What details did you discuss in your response? Check all that apply. the difference between expansionary policy and contractionary policy expansionary policies are used to stimulate the economy and reduce unemployment contractionary polices are used to reduce economic growth and combat inflation

2 proportional taxation

charges higher and lower income citizens equally in porportion to their income OR CALLED FLAT TAXES proportional income tax income 25,000 tax rate 15% tax paid 3,750 75,000 tax rate 15% tax paid 11,250 150,000 tax rate 15% TAX PAID 22,500 50,000 10% 36,000 10%

3 Regressive Taxation

charges individuals with high incomes a LOWER percentage of their total income. 25,000 income 15,000 amount spent 1,050 sales tax rate 7% tax rate 4.2% 75,000 income 15,000 amount spent 1,050 sales tax rate 7% tax 1.4% tax rate 150,000 income 15,000 amount spent 1,050 sales tax rate 7% tax rate 0.7% 50,000 15% 36,000 20%

1 progressive taxation

charges individuals with higher incomes a higher percentage of their total income progressive income tax citizen a 25,000 10 percent 2,500 tax paid citizen b 75,000 20 percent 14,000 tax paid citizen c 150,000 28 percent 42,000 tax paid 50,000 20% 36,000 15%

1 Income taxes are paid on money earned

include wages and profits from investments are collected by the federal government and many state governments are direct and progressive taxes at the federal level The Congress shall have power to lay and collect taxes on imcomes Constitution of the United States Amendment XVi

Taxes that are paid by individuals on all money earned, including investments, are . Taxes that are paid by homeowners to state and local governments are . Taxes that businesses are required to pay on their earnings throughout the course of a year are

income taxes property taxes corporate taxes

This chart describes a tax system. The individual who benefits most from this policy is probably.

progressive Rohan

The chart describes a tax system. In this tax system, higher-income earners pay a(n) proportion compared to lower-income earners.

proportional equal

This scenario describes a tax system. Isabel pays Tony and Juan on the computer. pays the highest tax rate on the computer. would be the most affected by an increase in the sales tax rate.

regressive the same taxa s Tony Tony

1 sales taxes

taxes on purchased goods are collected by state and local governments are indirect and regressive

Maintaining appropriate tax levels government must keep taxes at an appropriate level

taxes that are too low will result in: less governement spending lower government employment less government funding for state and programs

Three ways governments can approach taxation

types of taxation: 1 progressive taxation 2 proportional taxation 3 regressive taxation

taxes on wealth and income

1 income tax 2 corporate taxes 3 property taxes

Scenario:Country SC hopes to create change in its technology industry.To influence the industry, the government implements a new fiscal policy by lowering the corporate tax rate. What are the most likely effects of this policy? Check all that apply. Businesses will likely pay workers less. Businesses will likely hire more workers. Businesses will likely earn higher profits. Businesses will likely invest less in the economy. Businesses will likely invest more in the economy

Businesses will likely hire more workers. Businesses will likely earn higher profits Businesses will likely invest more in the economy.

Scenario: Robert has recently learned that when he buys gas for his car he is not paying just for the product. A percentage of the total cost is going to the federal and state government as a form of tax. Based on what you have read, what type of tax is Robert paying? a tariff a sales tax an excise tax a corporate tax

excise tax

2 Corporate taxes

federal government and state governments require businesses to pay corporate taxes: on their earnings over the course of a year

responding to high inflation the government may institute contractionary policies when the economy is growing too quickly, resuting in inflation

high income taxes can lead to: less disposable income less spending decreasing demand lower inflation taxes up consumerincome consumer spending inflation down raise taxes slows demand

Scenario: Over the last several years there has been a decrease in the number of new homes purchased within Country DF. One reason for this is that taxes are high, so citizens have less money to invest in such large purchases. The federal government has determined that actions need to be taken to encourage citizens to purchase homes and boost economic growth. What action can the government of Country DF take to encourage citizens to purchase homes? maintain corporate tax rates raise income taxes raise property tax rates lower income taxes for homeowners

lower income taxes for homeowners

government institution expansionary polices when unemployment is high

lower taxes can lead to: more disposable income more spending more economic growth increasing demand less unemployment taxes unemployment down consumer income consumer spending up

Approaches to taxation Contractionary Policy

occurs when the government chooses to reduce the deficit or gain a surplus raising taxes decreasing spending expenditures are more than revenue higher taxes unpopular

Congress shall have power

power to tax: Congres lay and collect taxes duties imposts excises Article 1, section 8