Note Sheet – TAXES

1. Taxes - ______made to the G to cover the costsof ______.

2. Tax rate - ______taken by the government.

3. Progressive taxes – takes a ______% of income from ______income groups.

4. Proportional taxes[flat rate] – takes the ______% from ___ income groups.[flat tax on income]

5. Regressive taxes– takes a ______% from ______income groups.[flat tax on product]

What type taxes are the following? A.Progressive B. Proportional C. Regressive

___1. Excise Tax(alcohol)___5. Individual Income Tax[10%, 15%, 25%, 28%, 33%, 35%]

___2. Sales Tax(6 ¼)___6. State Income tax of 7% on all income groups

___3. Estate Tax___7. Property Tax[5% on all $100,000 valued houses]

___4. Cigarette Tax___8. Social Securityfor those making under $102,000[6.2%]

6. In judging fairness of taxation, the ______-____-______principle says people with

more ______or ______should pay ______taxes. This tax has your name on it so

it (can/can not) be transferred to another person.

7. The ______-______principle says people who ______from its use bear its cost.

This is a flat tax on the product(cigarettes), not on the person’s income, so it

(can/can not) be transferred to another person. This is a consumption tax.

  1. The 3 major taxes of the federal government(90% of its revenues) are the

______, ______, and the ______tax.

  1. A dependent living with their parents pays no individual income tax up to $______.
  2. For every dollar you earn, you pay ______% in FICA[Soc.Secur. & Medicare], up to $______.
  3. The corporate income tax is a ______tax levied on a corporations’ ______.
  4. The excise tax is a ______sales tax on ______products. The excise tax is a(an)

(progressive/proportional/regressive) tax.

  1. (Educated/Uneducated) people smoke the most. [Hint: Which is dumb enough to commit

slow suicide?]

  1. In the last 70 years, the marginal tax rate has been as high as ______%.
  2. The estate tax doesn’t take effect until assets exceed $______. The gift tax is on gifts

in excess of $______. Both of these taxes are (progressive/regressive/proportional).

  1. The customs duty[tariff] is a tax on ______.
  2. The 3 most important state & local taxes are the ______tax, ______tax, and the

state ______tax.

  1. Sales tax– a (regressive/progressive/proportional) tax levied on ______products.

The sales tax is not levied on baby clothing, ______, & ______.

The sales tax in Dallas is _____% of every dollar.

  1. The property tax is a tax on ______, mainly a tax on ______& ______.

A poor & rich person owning $75,000houses pay the same taxes, making this a ______tax.

20. Americans pay about _____ cents of every dollar in taxes.

21. The ______of ______& ______devises the yearly budget for the president.

22. Because of tax ______, the government loses $_____ billion every year.

23. “Guns or butter” means the “G” spends money on ______or ______programs.

24. When “G spending exceeds T revenues”, this results in a ______.

25. When “T revenues exceed G spending”, then a ______results.

26. Causes of budget deficitsinclude 1.) National emergencies, 2.) providing ______

3.) ______the economy, 4.) promotion of______-______of citizens.

27. The National[Public] (debt/deficit) is the ______of money (over 200 years

worth) the federal government owes its creditors.

28. The budget (debt/deficit) is the debt incurred during ______.

The debt now totals $ ______trillion.

The interest on the debt will cost up $____ billion this year, or ___% of each dollar.

Most of the Public Debt is held (internally/externally).

29. Two ways to balance the budget is to a.) ______taxes, or b.) ______spending.

30. The purpose of the Gramm-Rudman-Hollings act was to ______the ______.

31. Texas gets most of its revenue from the ______tax.

32. Because Texas relies mostly on sales, property, & excise taxes, it is relying mainly

on (progressive/proportional/regressive) taxes to run the state. Among the 50 states,

Texas has one of the most (progressive/regressive) tax systems.

Texas (does/does not) have a state individual income tax.

33. The largest percentage of state & local taxes go to support ______.

34. An indirect tax is levied on the ______& a direct taxis levied on ______.

Matching

A.Taxes

B.Tax rate

C.Proportional Tax

D. Progressive tax

E. National debt

F. Deficit

G. FICA[Social Security & Medicare]

H. Customs duty

I.Regressive taxes

J.Direct taxes

K.Indirect taxes

L.Excise tax

___ 35. Takes a larger percentage of tax from the high income groups.

___ 36. A tax on the product[rather than on a person’s income]

___ 37. A variable % regressive tax[alcohol/cigarettes/gasoline] on specialized products.

___ 38. Takes 7.65% of every dollar for most workers[paid mainly to retirees].

___ 39. A tax on the individual’s income[rather than on the products he buys]

___ 40. Mandatory payments made to the government.

___ 41. Percent of income taken by the government.

___ 42. Tax taking larger percent from low income groups.

___ 43. Total amount of money government owes to creditors over a 200 year period.

___ 44. Government expenditures exceed incoming tax revenues for one fiscal year.

___ 45. Tax on goods brought into the U.S.

___ 46. A tax taking the same percentage from all income groups.