Taxing for nonrevenue purposes

Remember, the power to tax can be used for purposes other than the raising of revenue. Usually, that other purpose is to regulate some activity that is harmful or dangerous to the public. Thus, regulation of narcotics is based on the taxing power. Federal law provides that only those who hold a valid license may legally manufacture, sell, or otherwise deal in those drugs – and licensing is a form of taxation. The government also regulates a number of other things by licensing (including certain firearms, prospecting or public lands, hunting of migratory birds). The federal excise tax on gas-guzzling cars is intended to discourage their purchase.

Nontax revenue and borrowing

Large sums of money reach the federal treasury from a multitude of nontax sources: the interest on loans made by federal agencies; fees for such items as passports, copyrights, patents and trademarks also generate large sums.

Congress has the power “to borrow money on the credit of the US”. Historically, the power to borrow has been viewed as a power that makes it possible for the government to:

1. meet the costs of short and long term crisis situations

2. finance large-scale projects that would not be paid for out of current income

Thus, the Federal Government borrowed huge sums of money when the US entered World War 1; to combat the Depression of the 1930s; and again during World War 2.

In recent decades, the Federal Government borrowed for another reason: deficit financing. Over these years, the government has spent more that it has taken in. that is, it has run up an annual deficit – the yearly shortfall between income and outgo; and it has borrowed to make up the difference.

Borrowing produces a debt, of course. The public debt is estimated to reach $4trillion in 1992. No constitutional limit exists on the amount that may be borrowed. Congress has put a statutory ceiling on the public debt, however, which can be raised whenever the need arises.

The current debt will have to be paid by future taxpayers. Most of those who are most concerned about the size of the debt are worried about its impact on future generations of America. They believe, that today’s deficit financing – that is, today’s borrowing to pay for yesterdays and today’s spending – is being done at the expense of tomorrow’s taxpayer.

Vocabulary

1. to complain - жаловаться

2. to levy taxes for non-revenue purposes – собирать налоги для внебюджетных статей дохода

3. to limit/limitation – ограничивать, ограничение

4. to prohibit the export of certain goods – запрещать экспорт некоторых товаров

5. custom duties – таможенные пошлины

6. direct taxes must be equally apportioned – прямые налоги должны быть равномерно распределены

7. a capitation tax – подушный налог

8. to impose on – облагать, налагать

9. to apply to – прилагать, применять к чему-либо

10. to furnish health care – поставлять медицинское оборудование для учреждений здравоохранения

11. exemptions – освобождение, льгота, привилегия

12. deductions – удержание, вычет

13. home mortgage – ипотека под строительство жилья

14. charitable organizations – благотворительные организации

15. net income – чистый доход

16. to be subject to – быть подверженным чему-либо

17. payroll tax – налог с заработной платы

18. to withhold - взимать

19. at a flat rate – по единой шкале

20. excise tax – акцизный налог

21. a levy – сбор, налог

22. retail consumer – розничный потребитель

23. estate tax – налог на недвижимое имущество

24. an inheritance tax – налог на наследство

25. a gift tax – налог на дарение

26. to hold a valid license – иметь действующую лицензию

27. multitude - множество

28. conscience fund – “фонд совести”

29. to combat smth – бороться с чем-либо

30. shortfall – нехватка, недобор

31. to authorize – разрешать, санкционировать

32. accrued interest – процентный доход, набежавший процент

33. at the expense of smth – за счет чего-либо