ML FBLA Financial Literacy - Taxes

What is a tax?

• A fee paid to the government

• A donation to a charity

• A loan from the government

• A payment for goods and services

Why do people pay taxes?

• To earn money from the government

• To support government services like schools and roads

• To save for retirement

• To buy products from the government

Which of the following is a type of tax that people pay on the income they earn?

• Sales tax

• Property tax

• Income tax

• Luxury tax

What is the main purpose of income tax?

• To fund social security programs

• To fund government programs and services

• To help people with personal loans

• To reward workers with bonuses

What is the difference between a progressive tax and a regressive tax?

• Progressive taxes take a higher percentage from lower incomes

• Regressive taxes take a higher percentage from higher incomes

• Progressive taxes take a higher percentage from higher incomes

• There is no difference between the two

Which of these is an example of a regressive tax?

• Income tax

• Sales tax

• Property tax

• Inheritance tax

What is the purpose of Social Security tax?

• To fund national defense

• To provide financial support for people after retirement

• To pay for local government services

• To fund education programs

What is payroll tax?

• A tax paid on the money you spend in stores

• A tax that employees and employers pay to fund social services like Social Security and Medicare

• A tax on the purchase of property

• A tax on luxury goods

What is a sales tax?

• A tax on income earned from a job

• A tax added to the price of goods and services at the time of purchase

• A tax paid only by businesses

• A tax on the wealth of individuals

What is an example of something that might be taxed with a sales tax?

• A paycheck

• A car purchase

• A mortgage payment

• A home rent payment