Sources of State Revenue
SS8E4 The student will identify revenue sources for
and services provided by state and local
governments.
a. Trace sources of state revenue such as
sales taxes, federal grants, personal
income taxes, and property taxes.
Sources of State Revenue
It costs money to run a state
government.
Where does this money come
from?
Sources of State Revenue
Sales taxes- Also known as a “consumption
tax,” a sales tax is paid on things that people
buy and consume. These include items like
cars or any merchandise you would buy from
a store.
Sources of State Revenue
Federal Grants- The U.S. government gives
states federal grants to help fund education
or build interstate highways.
Sources of State Revenue
• Personal income taxes- States and the
U.S. government tax the earnings of
individual citizens and the money they
earn from investments.
• Taxes are due on April 15th each year.
Sources of State Revenue
Sources of State Revenue
Property Taxes- Private homes, land, and
business property are taxed according to their
value. Property taxes are a major source of
revenue for local government.
Activity 1
Write T for true and F for False
Who gets the Money?
SS8E4 The student will identify revenue
sources for and services provided by state
and local governments.
b. Explain the distribution of state
revenue to provide services.
Who Gets the Money?
• State revenue is distributed among state and
local programs to provide citizens with services
like education, roads, public transportation, and
police and fire protection.
• Elected officials have to make choices to
allocate limited funds for services that citizens
need and want.
Who Gets the Money?
• How does a state decide how to spend its
revenue?
• The Georgia Constitution requires that the state
government operate under an annual budget.
The budget details how much revenue should
be available, how much the government plans
to spend, and where the money will be spent.
• The General Assembly must pass legislation
known as an “appropriation,” which permits
spending from the budget.
Who Gets the Money?
• Many people and groups have input into the
state budget.
• They include the governor, the Office of
Planning and Budget (OPB), a state economist,
top officials in state departments and agencies,
the legislature, special interest groups, and the
state auditor.
Balancing the Budget
SS8E4 The student will identify revenue
sources for and services provided by state
and local governments.
a. Evaluate how choices are made given
the limited revenues of state and local
governments.
So Many Choices…
• Spending choices are difficult because of the
limited revenues of state and local
governments.
• In addition, state law requires that the Georgia
budget must be balanced. This means that
spending cannot exceed revenues—in other
words, the state operating budget cannot go
into debt.
So Many Choices…
• The budget process begins in the spring when
state agencies submit their budget requests.
• The head of each agency decides how much
money he or she will need during the year.
• In the fall, the OPB looks over the requests and
decides what items must be cut or modified.
So Many Choices…
• The OPB considers what programs are
important to the governor and the performance
of each agency in previous years.
• Finally, the governor’s budget proposal is
presented to the General Assembly in January
of each year.
Balancing a Budget
The state of Georgia requires a
balanced budget.
What are the positives and negatives of
a balanced budget?
Balancing a Budget
The U.S. does not require a balanced
budget.
What are the positives and negatives of
not having a balanced budget?
Activity 2
Quick Quiz