Podcast
Questions and Answers
What is the definition of fiscal policy?
What is the definition of fiscal policy?
- Fiscal policy is the government's control over international trade agreements.
- Fiscal policy is the process of printing more money to stimulate the economy.
- Fiscal policy is the government's regulation of the stock market.
- Fiscal policy is how the government adjusts spending and monitors taxes to help the economy. (correct)
What is tax revenue used for?
What is tax revenue used for?
- To finance government officials' personal expenses.
- To fund international aid programs.
- To support scientific research and development.
- To provide defense, road systems, education, and law enforcement. (correct)
What does the United States Constitution spell out regarding taxes?
What does the United States Constitution spell out regarding taxes?
- The process for citizens to avoid paying taxes.
- The allocation of tax revenue to different government departments.
- The ability to collect taxes. (correct)
- The specific tax rates for each state.
What is the purpose of taxation according to the text?
What is the purpose of taxation according to the text?
What does Article 1, Section 8, Clause 1 relate to?
What does Article 1, Section 8, Clause 1 relate to?
What does Tax Base refer to?
What does Tax Base refer to?
What are the three main tax structures mentioned in the text?
What are the three main tax structures mentioned in the text?
What is another name for Proportional Tax?
What is another name for Proportional Tax?
Which tax structure entails higher tax rates for higher incomes?
Which tax structure entails higher tax rates for higher incomes?
What does Regressive Tax involve?
What does Regressive Tax involve?
What characteristics do good taxes possess according to the text?
What characteristics do good taxes possess according to the text?
What does the US government impose taxes on to fund related services?
What does the US government impose taxes on to fund related services?
What are Tax Incentives used for?
What are Tax Incentives used for?
How is Federal government revenue collected?
How is Federal government revenue collected?
On what basis are income taxes collected?
On what basis are income taxes collected?
What are Corporate income taxes levied on?
What are Corporate income taxes levied on?
What does FICA consist of?
What does FICA consist of?
What percentage of a worker's income is withheld for Social Security and Medicare?
What percentage of a worker's income is withheld for Social Security and Medicare?
What are unemployment taxes?
What are unemployment taxes?
What are excise taxes collected on?
What are excise taxes collected on?
When are estate taxes imposed?
When are estate taxes imposed?
What is the annual exclusion for gift tax per person?
What is the annual exclusion for gift tax per person?
What are import taxes or tariffs imposed on?
What are import taxes or tariffs imposed on?
What does mandatory spending include?
What does mandatory spending include?
What is discretionary spending for?
What is discretionary spending for?
When does deficit spending occur?
When does deficit spending occur?
What are states' operating budgets for?
What are states' operating budgets for?
What is the requirement for states' balanced budgets?
What is the requirement for states' balanced budgets?
Study Notes
Federal and State Taxation and Spending Overview
- Federal Insurance Contributions Act (FICA) consists of Social Security and Medicare contributions from both employees and employers.
- Approximately 6.2% of a worker's income is withheld for Social Security and Medicare, with employers matching that amount.
- Unemployment taxes are insurance payments to protect workers if they become involuntarily unemployed, with restrictions on eligibility and limited benefits.
- Excise taxes are collected on the sale of goods or services, similar to sales tax.
- Estate taxes are imposed on the assets of a deceased person, with a progressive tax rate for estates over 1.5 million dollars.
- Gift tax is levied on money or property given by one living person to another, with an annual exclusion of $14,000 per person.
- Import taxes, or tariffs, are imposed on goods imported into the country to make foreign goods more costly and support domestic producers.
- Government spending consists of mandatory spending, including entitlements like Social Security and Medicare, and discretionary spending, such as defense and other choice-based expenses.
- Mandatory spending is required by law and includes entitlement programs funded by workers' contributions.
- Discretionary spending covers optional expenses like defense, agriculture, training, and scientific research.
- Deficit spending occurs when the federal government spends more money than it earns in revenue, leading to borrowing and the accumulation of national debt, currently around $18 trillion.
- States have operating budgets for day-to-day expenses and capital budgets for major investment expenses, with a requirement to have balanced budgets.
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Description
Test your knowledge of federal and state taxation and spending with this overview quiz. Explore topics such as FICA contributions, unemployment taxes, estate and gift taxes, import tariffs, government spending, mandatory and discretionary spending, deficit spending, and state operating and capital budgets.
