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Government budget - Coggle Diagram

- - - - Economy performs poorly
      - Poor management of revenue collection and spending
      - Large expenditure on investment for development
      - Unforeseen disasters, pandemics
- - - - Increase tax rate with increase tax revenue up to a point (T*)
      - However, increase tax rate beyond efficient tax rate (T*) will see a reduction in tax revenue
  - - - Personal income tax
        
        Progressive rate
      - Corporate income tax
        
        Flat rate
    - - Direct tax
        
        Assessed directly on individuals
        
        Payroll: tax on earnings of workers
        
        individual income tax: a tax paid on individual income accrued during the year
        
        Wealth taxes: taxes paid on the value of the assets such as real estate or stocks, held by a person or family
      - Indirect tax
        
        Tax individuals indirectly by taxing their transactions
        
        Consumption taxes, VAT
        
        In the USA, use sales tax for purchasing goods/services
        
        When applied to only certain goods, like cigarettes, cars or gasoline, sales tax is called an excise tax