We mostly grumble about having to pay the tax man. The government, reeling in debt, paying millions to other countries for aid, comes along and wants to take a chunk of our hard-earned money! What for? We might wonder. Well, there are good reasons why we should be thankful that we pay taxes, for some of the services from our local, state and federal government are supported by everyone’s tax dollars.
Infrastructure
Infrastructure is a word we’ve heard in the news recently as our government considers spending money to refurbish roads, bridges and federal buildings. These construction projects promise to provide jobs for our citizens and circulate money throughout local economies. However, without the Federal Income Tax (FICA), corporate taxes and tariffs, there would be no way that our roads and bridges could remain operable. No private entity, even a group of them, would be able to fund large-scale federal infrastructure spending. Without taxes, you may not have a road to drive to work on.
Subsidies
Speaking of driving, part of the expense to build the car you’re driving may well have been subsidized by the federal government or revenue collected by your state government. From manufacturing to research and development to corporate tax breaks, these government forces combine to allow companies to build and sell relatively cheap cars and to distribute relatively cheap fuel. Subsidies help a range of local industries from agriculture to education.
Education
College will be one of the most expensive endeavors for most families that send kids to get a higher education. Student loans will likely eat up a substantive chunk of the salaries of those college graduates. Yet, without some help from federal, state and local government revenues, some families may not even be able to send their kids to high school if their families had to pay. Our tax dollars collectively pay for secondary school education for the vast majority of kids in the United States. And when they graduate and attend college, federal programs help fund college courses, offer grants for those who wouldn’t be able to afford college and provide loan subsidies to bridge the gap of some expenditures. There are even federal programs that help to mitigate the expense of student loans. Many from prior generations used a federally funded program known as the G.I. Bill to help former members of the armed services pay for college.
Military
Our military protects us at home and advances our interests abroad. We spend about $500 billion on our military (the approximate amount capped by legislation in 2011). That’s 15% of the federal budget. We can disagree on whether we should spend that much; however, few believe that we don’t need a military, and we all fund that through taxes.
Protective and Emergency Services
Our taxes also fund other organizations that aim to benefit the public good. Taxes primarily fund police forces and fire departments. Taxes subsidize emergency health care through deductions and, under the Affordable Care Act, insurance subsidies. Taxes fund the prisons we use to house criminals as they rehabilitate or pay their debt to society. At a local level, the things we take for granted in our everyday lives are funded or subsidized by tax revenue.
In the farewell address of our first President, George Washington, the “father of our country” told his audience “. . . that to have revenue there must be taxes,” and “that no taxes can be devised which are not more or less inconvenient and unpleasant . . .” It’s never fun to pay taxes. Yet, for us to be able to fulfill the promise of life, liberty and the pursuit of happiness, we all have to chip in. If you have, for some reason, fallen behind in keeping your obligation to pay income taxes, a seasoned tax attorney can help. A lawyer can help you negotiate with the IRS to get caught up or take more direct action if your situation is direr.