Government spending and taxation Teacher’s please print off the notes to guide you

What the exam board needs you to know...

Lesson objectives 1.To be able to discuss government spending 2.To be aware of how the Government taxes workers 3.How businesses are affected by changes in government spending and taxation

Where do you think the government will get 697 billion?

This is where some of the money comes from that the Government gets to spend. Lets look at all those now.... Income tax 150bn Nat INs £99 bn VAT £81bn How much does this add up to? Is it all the money the Government needs? Other taxes account for 218 billion

Income Tax Now... Calculate 20,000 tax

VAT VAT (Value Added Tax) is a tax that you pay when you buy goods and services in the EU (European Union), including the UK. If you have to pay VAT on something, it will normally be included in the price you see.

How much extra income do you think the 5% VAT increase Will make for the Government to spend? How much extra income do you think the 5% VAT increase Will make for the Government to spend?

The Government estimates it will make £13 billion by 2015 Who was closest? The Government estimates it will make £13 billion by 2015 Who was closest?

How does the UK compare to the EU on VAT rates?

Super hard question... What affect will the VAT rise have on businesses and consumers?

National Insurance Who Pays National Insurance? Do people pay a voluntary NI contribution to the Government? Does what you pay in NI affect any benefits you could get ?

NI – how much will you pay?

Where does the rest of the money that the government needs - come from? National Insurance Income Tax VAT ?

Where does the rest of the money that the government needs - come from? National Insurance Income Tax VAT £149 billion borrowed

What does the government spend all its money on?

Where does the money go? Health122 billion Education89 billion Public Order35 billion International Development 6 billion Defence, industry, housing, social services and other 208 billion Benefits194 billion

The government has to pay interest on all the loans (debt) that it has.... Debt interest £43 billion

So what about the shortfall? 1.Spend less 2.Tax more

Spend less – on what? 3000 less prison place Reduction in benefits

Did you meet the Lesson objectives? 1.To be able to discuss government spending 2.To be aware of how the Government taxes workers 3.How businesses are affected by changes in government spending and taxation

Extras BBC do you get back as much as you pay in? Video BBC do you get back as much as you pay in? Video BBC video where does the government get its money from? BBC video where does the government get its money from? BBC interactive graphics government spending cuts BBC interactive graphics government spending cuts These extras will require an Internet connection to play