Understanding Economics

From as enormous as I could remember Taxes have almodal values been apart of our cursory lives. Taxes canister often be a big burden for most, they can also be a help and used for many some other functions. If it was not for valueation our roads, frequent buildings would be a complete mess. Our arrest operate such as, law enforcement, EMT, and Fire/rescue thrive mop up of taxation dollars, many of our healthc atomic number 18 offices also use tax payers capital to stay open. The impose process from distribution to collecting them has pot on the fence with different point of views.In this paper I departing be discussing the questions raised about taxation. What happens to net personal income when the regimen raises taxes? When the political relation raises taxes, it impart decrease your net personal income. As the government raises taxes, most peoples net personal income will decrease, which means that their disposable income decreases as well. When this happens peop le t bar to spend less capital exactly to head off going into debt, which will soon affect the markets income be display case they ar no longer secureing goods and services with their disposable income.This problem will eventually lead to a decrease in total tax revenue as the gross incomes of the population can drop. When the government lowers taxes? When the government lowers taxes people feel more than comfortable with spending more of their money. swallow taxes allow the population to buy more goods and services because they fuck that their money will go a long way. The lowering of taxes along with a controlled government over looking spending will have a fast and positive effect on the economy. People spending more money will not only stimulate the economy, but will eventually lead to more jobs.Lower taxes equals happy people and a dampen economy. How is GDP affected by higher taxes and Lower taxes? The Gross domesticated product (GDP) is affected when the government brings in more taxes then they spend, cut back disposable income and slowing the growth of the economy. That is when Fiscal policy comes into place make some type of stabilization to the economy along with higher taxes. fit in to E-how, Tax cuts mean more disposable income for individuals and more retained recompense for businesses. The impact on the GDP depends on what individuals and businesses do with the extra cash.If households buy more goods and businesses increase hiring and capital equipment purchases, the GDP will increase. A diminution in taxes also means less revenue for the government at all levels, which generally leads to lower government spending, higher deficits or some(prenominal) ( eHow. com, 2012). What other economic factors are affected when taxes are raised or lowered, and how are they affected? Other economic factors that are affected by the mounting and falling of taxes are, sales tax, healthcare, and major government programs.When sales tax is raised it puts a financial strain on employers and individuals, and will allow in job loss. Healthcare services thrive off of the rise in taxes and when taxes fall they suffer tremendously. Low income families depend on these services and without the proper funds. Government programs are affected when revenue result in increased taxes. When this happens, these government funded programs has to increase their budgets. Once funds start approach path in slowly then these programs such as, military, FBI, Medicare, Medicaid, , and social security, once taxes are increased these programs are able to maintain.In fiscal year 2009, carry governments spent 40 percent of their budgets on K-12 and higher education and 26 percent of their budgets on social programs such as Medicaid, transportation, corrections and public assistance. Funding for the following programs increase as tax revenues increase (eHow. com, 2012). Should the government increase tax rates on everyone as a way to equalize incom es and wealth? No, the government should not raise taxes on everyone, only for those who are extremely wealthy like Earvin Magic Johnson, who is worth $700 million.The core class are going to suffer from the tax increase. This is a political problem that will cause more headaches for everyone and will probably end with the middle class paying more in taxes. Now we know that taxes will make or break things in this nation, and will cause a lot of debates amongst government officials. Taxes will be around forevermore and we have to get use them changing, I have discussed the questions about the taxing process and I hope you will take something from it.