Page 91 - Key to Social Studies 4

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Why Do Governments Need Taxes?

Governments tax citizens to collect money that

is needed to provide goods and services for the

welfare of the people.

A tax is a cost imposed by the government

which is used to cover public expenditures.

Government expenditures may include

• education

• health

• military

• electricity and water

What Are the Types of Tax?

There are many types of tax:

Sales Tax

This is a tax placed on any sold product.

Income Tax

This is a percentage of money charged for what

people earn from their jobs.

Property Tax

This is a cost people who own a home or land

should pay.

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