Lesson 56
A Big Fat Budget
A Big Fat Budget
What is a Budget?
A plan of income and expenses, usually for a year
What is the greatest source of revenue for the federal government?
Income Tax
What is a sales tax?
A tax governments charge when a person makes a routine purchase
The major portion of a county's revenue comes from what?
Property taxes
Some people believe that governments should use taxes to influence what?
Behavior
What office holder proposes the federal budget to Congress?
The President
Most Americans pay their income tax through what process?
Withholding
What groups generally don't have to pay sales tax on purchases they make?
Churches and charitable organizations
Do businesses or individuals generally pay higher taxes?
Businesses
Income
Why do government agencies try to spend all of the money in their budgets?
In order to prevent their budget from being cut the next year
What is a progressive tax?
A Tax for which the tax rate is greater on higher incomes
What is a biennial budget?
A two-year budget
Who determines the appraised value for property taxes?
Lowering taxes
What spending restrictions do most states have that the federal government does not?
A requirement to have a balanced budget
The top one percent of Americans pay what percentage of the total income tax that the IRS collects?
38 %
What two taxes have become popular with state and local governments in recent years?
Amusement tax and hotel/motel tax
When are property taxes collected?
In arrears, or at the end of the period in question
Why was chartering a national bank controverial?
Because the Constitution did not authorize it
What conflicts do Conservatives and liberals often have concerning budgets?
Each side points to waste in the programs they don't like and defends the excesses in the ones they support. Conservatives tend to support spending on defense and liberals support spending on social programs (p. 337)
What is a government bond?
A loan that the government promises to pay back at a specific time in the future with interest
Why have governments found amusement and hotel/motel taxes attractive?
Because tourists from out of state and business persons on expense accounts pay most of them
What must people involved in collecting and spending public money be careful to do?
Use this powerful position only for good and ensure faithfulness in handling other people's money
Describe two situations the lesson mentions that might justify a government borrowing money
To provide funds to fight an enemy who has attacked or to stimulate the economy during a recession or depression