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Federal Spending

Federal Spending. January 6, Twenty-Ten. QUIZ – half sheet of paper. What are the restrictions on a tax? What kind of tax is the Federal Income Tax? What is an excise tax? Give an example of an excise tax. What is a W-4 form? What two things does FICA taxes use money on?.

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Federal Spending

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  1. Federal Spending January 6, Twenty-Ten

  2. QUIZ – half sheet of paper • What are the restrictions on a tax? • What kind of tax is the Federal Income Tax? • What is an excise tax? Give an example of an excise tax. • What is a W-4 form? • What two things does FICA taxes use money on?

  3. How does the government spend its money? • The government earned 2.1 Trillion dollars in 2009, but almost 75% of that must be spent on necessities for the people. • Government spending is grouped into two main categories… • Mandatory Spending - • Discretionary Spending

  4. Mandatory Spending • Mandatory Spending – spending on programs that are required by law – 68%. • Most of this money is used for Entitlement Programs – a social welfare program providing benefits to people who meet certain eligibility requirements • Social Security – is primarily a social insurance program providing social protection, or protection against socially recognized conditions, including poverty, old age, disability, unemployment and others.(wikipedia.org, 1.6.2010) - more then 50M retired/disable people receive it • Medicare –Pays for doctors costs for ppl over 65/disabled – serves 40M+ • Medicaid– entitlement program – benefits low-income families, ppl w/disability, and elderly IN NURSING HOMES. • Other – Food stamps, Veterans programs etc, Welfare, Disability, unemployment • Mandatory spending has been increasing

  5. Discretionary Spending • Discretionary Spending – Government planners have choices on what to spend this money on • ½ of this money - Defense • Weapons, salaries, vehicles • 4% - Education • Student Loans • National Parks • Law Enforcement • Gov Salaries • Research etc.

  6. Federal Aid to the States • 346M a year is divided between the states • Gov’t tries to be “thrifty” with this to help states that need it the most • Louisiana and Katrina • New York and 9/11 • States our often “bribed” to get the money • Lowering drunk driving levels to get federal funding. • Educational reform for money

  7. State Taxes • Must have a balanced budget • Cannot spend more than you take in • What taxes must be spent on • Education – 1 university, 1 CC, public schools • Public Safety – jail • Roads – highways • Public Welfare – hospitals, water/air testing • Arts and Recreation – museums, parks • Administration – pay people in gov.

  8. State Taxes • Where do they get the money? • Sales tax – 6% in MI • State income tax • Other – license, permits • Tobacco Taxes • Local taxes • Property Taxes – BIGGEST fund of public education

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