Revenue and Taxation

This set of flashcards includes various terms and definitions related to revenue, taxation, government spending, and budgeting, designed to aid in understanding these concepts.

Revenue

Income received by a government from taxes and other non-tax sources.

Power to Tax

The authority granted by the Constitution to the Legislative Branch to levy taxes.

Tax Structures

Different methods of assessing taxes, including Progressive, Proportional, and Regressive.

Progressive Tax

A tax structure where the percentage of income paid in taxes increases as income increases.

Proportional Tax

A tax where the percentage of income paid in taxes stays the same regardless of income level.

Regressive Tax

A tax structure where the percentage of income paid in taxes decreases as income increases.

Tax Base

The item or entities that are being taxed, such as Individual Income, Corporate Income, and Property.

Individual Income Tax

A tax based on a person's earnings.

Corporate Income Tax

A tax based on a company's profits.

Property Tax

A tax based on real estate and other properties.

Incidence of a Tax

The final burden of a tax, determining who ultimately pays the tax.

Characteristics of a Tax

Key features a tax should have: simplicity, efficiency, certainty, and equity.

Benefits-Received Principle

A taxation principle stating that taxes should be based on the benefits received from governmental services.

Ability to Pay Principle

A principle stating that taxes should be based on an individual's ability to pay, generally applied in progressive taxation.

Mandatory Spending

Expenditures that Congress is required by law to fund.

Discretionary Spending

Expenditures that Congress can decide how to allocate.

Entitlements

Social welfare programs that provide benefits to individuals who meet certain criteria.

Tax Withholding

The process where employers deduct income tax from employees' paychecks.

Tax Deductions

Amounts subtracted from gross income to reduce taxable income.

Corporate Tax Income

Taxes paid on business profits.

Excise Tax

A tax on specific goods, such as gasoline and tobacco.

Estate Tax

A tax on the value of a person's estate after death.

Gift Tax

A tax on money or property transferred from one individual to another.

Tariff

Taxes imposed on imported goods.

Operating Budget

A budget for day-to-day spending needs.

Capital Budget

A budget for major investments and infrastructure improvements.

Balanced Budgets

Budgets where revenues equal expenditures.

Local Government Spending

Expenditures by city, county, and other local entities.