Know how US tax functions in a simplified manner

We don’t talk about where the tax money absolutely goes in school or work. Strange. You are now going to learn things which your school didn’t teach you. So where does the tax money actually goes? It goes towards things like welfare Health Care the military and National Defense in general and you know transportation and debt almost all countries are in debt with one. Other little money actually goes towards paying off accumulated debt and its interest there are also loads of different little categories where your money goes towards one of them fancy the EU budget, so I don’t think it’s going to be there anymore, are not taught any of this in school. So how do you actually get taxed? 

I’m just gonna focus on income tax and more specifically we why you just pay as you earn and talk about how we get taxed on income tax actually just happens automatically. We don’t actually physically have to go out of our way and pay every month or whenever when you’re in for your painting just give your tax deducted straight away. 

You don’t have to do anything or just with matter think this is deducted along with National Insurance contributions have pensions or student loans if you have any everyone has a tax code and it’s this tax code that indicates your employer how much tax you should pay, tax codes the phone with how much you’re earning and how much tax-free income in the UK. You have a tax-free income of 12,500 pounds. That is a threshold. If you earn below back not get taxed.

The whole thing takes on the whole thing 14 some US states like Michigan, Illinois, and Colorado have personal taxes with us to place. Everyone is taxed the same percentage of their income and wealth is harmless. They other working-class middle-class over just a flat rate. And so sometimes this is known as a flat tax rate. If you have a proportional tax system, then it’s very important to find that balance in the tax rate. Because if the government sets the tax rate as zero percent, then they’re not going to get in Revenue. That’s not gonna be good for us the government or the economy, but similarly, if they set it at a hundred percent, but no one’s going to want to work because of all the money they earn and of those the government so there’s no reward work, which will then obviously damaged us the government and the economy people are not working sound like a horseshoe. Both extremes have the same result, but it’s important to find that middle ground so that 

Tax revenue is substantial enough while also keeping people happy enough and giving them an incentive. So you should actually go to work if you do economics, this is called a lot fatter. If you work in the UK and earn less than 12,500, you might still see tax deducted on your payslips, but do not worry. You’ll get this back at the end of the tax year, which is April as tax returns. Even if you own a taxable income could still get a tax return at the end of the tax year because you’ve paid too much text throughout the last Financial year. So there’s some basic information about how the tax works in the US. 

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