This topic contains a solution. Click here to go to the answer

Author Question: Outline the positives and negatives associated with the lack of personal income tax in Texas. ... (Read 44 times)

jazziefee

  • Hero Member
  • *****
  • Posts: 505
Outline the positives and negatives associated with the lack of personal income tax in Texas.
 
  What will be an ideal response?

Question 2

Discuss whether the Texas sales tax is regressive in nature.
 
  What will be an ideal response?



Related Topics

Need homework help now?

Ask unlimited questions for free

Ask a Question
Marked as best answer by a Subject Expert

Sierray

  • Sr. Member
  • ****
  • Posts: 343
Answer to Question 1

Answer:
A. Absence of Texas's personal income tax
1. positives: Conservative view
a. makes it more difficult for the state to raise tax rates
b. that raising it would likely have a negative impact on the state economy
c. state government is restrained
1. expenditures are essentially limited to current revenues plus increases that result from economic growth
2. coupled with the balanced budget provision, it limits the growth of government
2. negatives: Liberal view
a. current system is far too restrictive
b. Some vital government programs, such as education, deserve more government funding from an income tax
c. addition of a state income tax, unlike the sales tax, would be deductible from federal taxes

Answer to Question 2

Answer:
A. Regressive tax
1. system of taxation whereby the tax rate increases as income decreases
2. places a higher burden on the poor than the wealthy
B. Texas sales tax
1. largest single component of tax revenue
2. sales tax revenue increased 39 percent from 2010 to 2014
3. one of the highest sales tax rates in the nation
4. 6.25 percent tax is on the retail price of selected goods and services sold in the state
5. cities can assess their own 1 percent tax, which is added to the state levy
6. Special districts, such as those for parks, crime control, or sport facility construction, often add another penny to the actual tax rate
7. combined local and state tax rate can range as high as 8.25 percent
C. Regressive nature of Texas sales tax
1. sales tax does not apply to all purchases
2. high sales tax on purchases burdens a low income family and makes their tax payout a greater percentage of their income
3. discourages spending, which has a negative impact on both jobs and the economy
D. Factors that lesson the regressive nature of Texas sales tax
1. many of the expenses of a financially disadvantaged family are sales tax-exempt
2. food and prescription and nonprescription drugs, medical services, housing, and utilities are all free from the state portion of the sales tax
3. sales tax only applied to prepared food
a. family earning more money would be likely to eat out more often paying more food taxes
4. motor vehicle sales tax to be a part of the broader tax
5. different services are taxable





 

Did you know?

Most childhood vaccines are 90–99% effective in preventing disease. Side effects are rarely serious.

Did you know?

Though newer “smart” infusion pumps are increasingly becoming more sophisticated, they cannot prevent all programming and administration errors. Health care professionals that use smart infusion pumps must still practice the rights of medication administration and have other professionals double-check all high-risk infusions.

Did you know?

Although puberty usually occurs in the early teenage years, the world's youngest parents were two Chinese children who had their first baby when they were 8 and 9 years of age.

Did you know?

Drug abusers experience the following scenario: The pleasure given by their drug (or drugs) of choice is so strong that it is difficult to eradicate even after years of staying away from the substances involved. Certain triggers may cause a drug abuser to relapse. Research shows that long-term drug abuse results in significant changes in brain function that persist long after an individual stops using drugs. It is most important to realize that the same is true of not just illegal substances but alcohol and tobacco as well.

Did you know?

Blood is approximately twice as thick as water because of the cells and other components found in it.

For a complete list of videos, visit our video library