Topic 12.3 Financing Government with Taxes

Interest

A charge for borrowed money, generally a percentage of the money borrowed.

Regressive Tax

A tax for which the percentage of income paid in taxes decreases as income increases

Progressive Tax

A tax for which the percentage of income paid in taxes increases as income increases

Estate Tax

A tax on the estate, or total value of the money and property, of a person who has died

Excise Tax

A tax on the production or sale of a good, sometimes called hidden taxes because the tax is often passed on to the customer. Also known as "Luxury Taxes"

Gift Tax

A tax on the transfer of property by one individual to another while receiving nothing, or less than full value, in return excessing $15,000

Fiscal Policy

Government policy that attempts to manage the economy by controlling taxing and spending.

Monetary Policy

Government policy that attempts to manage the economy by controlling the money supply and thus interest rates through the Federal Reserve.

Panic

In banking, this is when depositors lose confidence in banks and rush to recover their funds.

Payroll Tax

Tax on wages and salaries that are withheld to finance government programs such as Social Security and Medicare costs

Customs Duty

Taxes sent upon goods brought into the United States from abroad (outside the US), aka tariffs, import duty, or imposts.

Inheritance Tax

a tax levied on the value of property bequeathed in portion by a deceased person