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How Did Tax Laws Shaped American Society

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Since individuals and businesses are required to pay various kinds of taxes, it is important to understand how tax laws shaped American society. America was tax-free for much of its early history; only after the Revolution did we have a government that was cautious on taxation. These laws has influenced our society in many positive ways, but has also had many negative outcomes. One way these laws has shaped American society is through the economic risks that we take which helped our tax preferences be taken accounted for and stand the test of time. It also maximizes opportunity through initiating social mobility and a wider range of institutions. In addition to this it had made us a more prosperous country, overall. The examination of this …show more content…

Much of our taxes are put into Social Security, health insurance programs, and other programs that help and support our society. Social Security for example, provides monthly retirement benefits for retired workers, their spouses and children, as well as the spouses and children of deceased workers and disabled workers, it takes up about 24% of our taxes (CBPP). Our taxes also fund 26% of our health insurance programs, including Medicare functions, administrative costs and premiums, as well as the “Grants to States for Medicaid” account, the “Children’s health insurance fund” account, and the “Refundable Premium Tax Credit and Cost Sharing Reductions” account (CBPP). Other programs where our taxes are put into are benefits for federal retirees and veterans, transportation, education, science and medical research, and non-security international affairs which makes use of about 18% of our taxes (CBPP). Taxes truly benefit the people, it provides us with assistance and support to help each one of us move forward. Its funding in things such as education and medical research are meant for improving our society’s lifestyle. The thought that are taxes are going into so many beneficial programs and expenditures helps spark opportunities for individuals and businesses to grow, expand, and most importantly, to move further ahead into more innovate new …show more content…

The structure and financing of our tax laws may not be perfect but it is critical for our country to have economic growth. By expanding the supply and the Gross Domestic Product (GDP) we are able to bring the economy into a higher economic growth path which is why, according to William Gale and Andrew Samwick, tax rate cuts will provide us with a larger economy in the long run, especially in terms of income tax. In addition, national consumption taxes, such as value-added tax and income tax, are also monitored to promote better economic growth and avoid any abuse from Congress (Jensen). However, with much analysis of historical evidence and simulations, it was found that “tax cuts that are financed by debt for an extended period of time will have little positive impact on long-term growth and could reduce growth” (Gale and Samwick) which is why it is best to avoid such tax reforms. This is important because with proper taxation people are able to express choice and make decisions that ultimately helps our economy grow. So, as long as our taxes continue to move and provide for every individual, business, and our country’s needs then it could be concluded that we have a healthy

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