Paying for the
Government
18.2
Marzano terms
15 minutes to get these in your folder
Proportional Tax
Progressive Tax
Regressive Tax
Direct Tax
Indirect Tax
Main Idea
• Federal, state and
local gov’ts tax
citizens directly and
indirectly …
Paying for the Gov’t
(491)
What’s the
story of Erin?
Tax Fairness
• Goods & Services
expectation
• Complain about
taxes?
• Unfair, too much,
income, sales,
property …
Characteristics of
a Good Tax
Duty of all to understand fair tax and now, The big 5
1.
Efficient and economical – not spend too much to collect
and process
2. Gov’t to provide a good reason for the tax
3. Tax MUST treat all fairly
4. Must be certain
5. Simple and convenient
Analyze Diagram
Page 492
Copy the diagram in
your notebook
Answer 1 & 2
Benefits-Received
Principle
Fairness
Should benefit those who pay the tax!
e.g., Gasoline tax
the more you drive,
the more you pay,
The more benefits received …
Gas tax …
Ability to pay principle
Taxes to be paid on ability
Related to income
TAX = $1,000.00
Nelson makes $100,000.00
Neumann makes $50,000.00
Is the tax fair?
Reading Check?
Who receives the
benefits of a fair
tax?
Answer …
Those who pay the taxes
should receive the
benefits!
read : Types of Income Taxes
on pages 493 - 494
Types of Income Taxes
(according to the ability to pay principle)
Proportional Tax – requires each person to pay the
same amount or percentage of their income in taxes
Progressive Tax – takes a higher percentage of taxes
from a person with a higher income than it does from
a person with a lower income.
Regressive Tax – takes a larger % of tax from the
income of a person with a smaller income than from
a person with a higher income.
Analyze charts
Page 494
Regressive tax summary
Review in your groups
Answer 1 & 2
Reading Check
page 494
What are the three
types of income
tax systems?
Political Cartoon
page 495
Discuss with in your
group
Answer 1, 2 & 3
RSS
Effects of Taxes
Still controversial
Economic consequence
To know the effect, we need to identify
what kind
Is it direct or indirect?
What is the impact?
Direct taxes
A tax on income
1. No choice but to pay
2.One person’s income tax
cannot be paid for by
another
Indirect taxes
Generally ends up as part of the price a
consumer pays for a product
where the tax (gov’t imposed), is
included in the price of an item(s)
Erin Neuman e.g.
Seller must pay the tax who passes it on
to the consumer
Tax Impact
READ Tax Impact, page 496
Retell the “coal story” in your group RSS
How does tax impact those who must buy, e.g.,
medicine?
How may consumers choose not to pay a tax that is
passed on as part of the cost of a good or service?
READING CHECK (PAGE 496)
ANSWER IN YOUR NOTE BOOK
WHAT IS THE DIFFERENCE
BETWEEN A DIRECT TAX
AND AN INDIRECT TAX?
ASSESSMENT PAGE 496
ANSWER 2A – 4B
IN YOUR NOTE
BOOK
PANTHERS!
PLEASE STAY
SEATED UNTIL THE
BELL RINGS