taxes
Definition
Taxes are mandatory financial charges or levies imposed by a government on individuals, businesses, and other entities to fund public expenditures and services. They are collected to pay for things like public infrastructure, education, and healthcare.
Analogy
Taxes are like the admission fee to a public park; just as everyone pays to enter and enjoy the park's amenities (playgrounds, trails, picnic areas), citizens pay taxes to access and support public services and infrastructure that benefit society as a whole.
Related terms
Revenue: The income received by the government from taxes and other sources used to fund public services.
Progressive Taxation: A taxation system where the tax rate increases as the taxable amount increases, meaning higher earners pay a larger percentage of their income in taxes.
Public Goods: Goods that are non-excludable and non-rivalrous, which means no one can be excluded from using them, and one person's use does not reduce availability to others
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