1. Which quote do you most agree with?
“In this world nothing can be said to be certain, except death and taxes.” –Benjamin Franklin (inventor, statesman, international celebrity)
“The only difference between death and taxes is that death doesn’t get worse every time Congress meets.” -Will Rogers (humorist and commentator)
“Taxes are the price we pay for a civilized society.”
–Oliver Wendell Holmes (former Supreme Court Justice)

2. A lesson on the nature of common taxes in Georgia.
The Facts After Taxes
A lesson on the nature of common taxes in Georgia.
Authored by Joel Miller for the Georgia Council on Economic Education-2017
*common taxes and fees are the focus of this lesson which will include basic federal taxes (income, FICA, estate)

3. Tax Freedom Day® is the day when the nation as a whole has earned enough money to pay its total tax bill for the year. Tax Freedom Day takes all federal, state, and local taxes—individual as well as payroll, sales and excise, corporate and property taxes—and divides them by the nation’s income. In 2017, Americans will pay $3.5 trillion in federal taxes and $1.6 trillion in state and local taxes, for a total tax bill of $5.1 trillion, or 31 percent of national income. This year, Tax Freedom Day falls on April 23, 113 days into the year.
This year, Americans will work the longest—46 days—to pay federal, state, and local individual income taxes. Payroll taxes will take 26 days to pay, followed by sales and excise taxes (15 days), corporate income taxes (10 days), and property taxes (10 days). The remaining six days are spent paying estate and inheritance taxes, customs duties, and other taxes.
Tax Freedom Day (Tax Foundation.org) updated annually

4. Total income is all earned income, interest, dividends, etc.
Do American income earners have the freedom to choose whether to save or spend their money?
Total income is all earned income, interest, dividends, etc.
Disposable Income = total income – taxes – expenses
-Disposable income is the amount of money households have available for spending and saving after taxes and expenses.

5. Get a Job in Georgia! I am going to give you an Occupation card.
Record the data on the top of the handout I give you
You need to line-up around the classroom, ordering yourselves from the most common occupation in Georgia to the least common
You will read aloud your occupation, salary, and number of people employed.

6. GA’s Tax Freedom Day is April 17
Tax Freedom Day® represents how long Americans have to work in order to pay the nation’s annual tax burden by state.
Tax Freedom Day® assumes that every dollar earned starting January 1 until the Tax Freedom date is paid to some level of government as tax revenue.
The total tax burden borne by residents across states varies considerably due to differing tax policies and the progressivity of the federal tax system. This means that states with higher incomes and higher taxes celebrate Tax Freedom Day later: Connecticut (May 21), New Jersey (May 13), and New York (May 11). Residents of Mississippi bear the lowest average tax burden in 2017, with their Tax Freedom Day having arrived on April 5. Also early were Tennessee (April 7) and South Dakota (April 8).
GA’s Tax Freedom Day is April 17

7. GA Population growth
Between 2000 and 2010, Georgia’s population grew by 1.5 million. Along with six other states (TX, CA, FL, NC, & AZ) accounted for over half (54.0 percent) of the overall increase for the United States.
Between 2000 and 2010, Texas experienced the highest numeric increase, up by 4.3 million people. California, which had the largest population increase in the previous decade, increased by 3.4 million over the same period; followed by Florida (2.8 million), Georgia (1.5), North Carolina (1.5 million), and Arizona (1.3 million).

9. How does population growth impact Georgia’s PPC
How does population growth impact Georgia’s PPC? (assume labor force growth)

10. A growing population means more services needed in the public and private sectors…
Goods or services provided by the government are known as public goods.
The money that a government takes in is called revenue.
The state of Georgia has a number of revenue sources, including several forms of taxes, fees, and lottery funds.
Between 2008 and 2012, the total amount of GA state revenue averaged more than $16 billion each year.
(pictures: Forsyth Park playground Savannah, GA; City of Atl ladder truck; S. Forsyth HS expansion Cumming, GA; Lake Lanier Water Treatment Gwinnett Co., GA; I-285 traffic Atlanta, GA) In fiscal year 2016, the Department collected $28.4 billion in gross tax revenues and distributed $4.9 billion in sales
4.6 million individual income tax returns were issued and almost 3.2 million refunds returned by the GA Dept. of Revenue
Digby, Michael F. "State Revenues in Georgia." New Georgia Encyclopedia. 03 August Web. 09 May 2017.

11. Funding Schools
School districts rely on property taxes to provide educational funding.
Property values and tax rates determine the revenues generated for schools through property taxes.
Why might property owners rather see their home’s market value increase rather than their property tax rate?

12. What does your public education cost?
Ambiguous School Districts
Student Population (FTE)
Median Home Value
Average Annual Property Tax
Per Pupil $ for Instruction
Per Pupil $ for Total Expenses
Big City Schools
95,248
$234,400
$2,782
$6,613.83
$10,072.01
Metro-Area District
114,410
$225,300
$1,697
$6,297.21
$8,893.49
Coastal District
36,910
$156,100
$1,435
$6,682.20
$10,064
Southern School System
9,217
$88,700
$648
$5,999.06
$8,971.50
Western District
14,414
$121,300
$975
$5,676.04
$8,358.12
North Mountain District
2,943
$299,900
$649
$7,182.99
$10,923.20
State Average
1,736,628
$154,200
$1,685
$6,008.35
$9,020.46
Median home values:
Search by school district:
Average Property Tax data:
Total Expenses Includes include expenses for: Instruction, Pupil services, Staff services, General Administrative, Transportation, and Maintenance and Operations

13. Fire protection in one of the three fastest growing GA counties:
What do you think fire protection costs in a county with roughly 222,000 citizens?
One fire engine (pump truck) costs $675,000 in 2017
One ladder truck costs $1.4 million
11,000 fire hydrants to maintain (1 for every 20 people)
Average response time is 5 minutes and 30 sec.
85% of all fire station responses are medically-related (no fire)
The average annual income for a firefighter in Georgia is $36, benefits (health, life, and disability insurance & retirement)
Source: J. Miller interview with local district Fire Chief on May 11, 2017
There are approximately 222,000 residents in the Forsyth County. It was the fastest growing county in the state from

14. What would you pay for professional firefighters to protect your home?
The local government determines how much property owners must contribute to fire protection through the property tax.
A millage rate for fire protection costs a $200,000 home owner about $158 a year on their property tax bill (depending on local taxes)
Would you rather have volunteer departments on standby or professionals on-the-ready?
Teacher Notes: Property taxes paid for fire protection do not insure a property owner’s property in the event of a fire disaster. Home owner’s insurance (property insurance) is usually paid as part of the monthly mortgage payment. Property Insurance helps compensate property owners in case of losses due to fire damage.
Other local fees—such as impact fees—may also support new purchases for fire departments.
There are 644 fire departments in Georgia; operated by both county and local municipal governments.
Fees and taxes for fire protection is not the same as property insurance; only property insurance can provide compensation for damages caused by fire

15. 3 Common Tax Types: *Fill definitions in on Handout 1
Income
Amount of Tax
% of Income Paid in Tax
$50,000
$2,500 5%
$75,000
$5,625
7.5%
$100,000
$10,000
10%
Progressive tax- requires a larger percentage of income paid in tax from high-income earners than it does from low-income earners
Regressive tax- requires a larger percentage of income paid in tax from low-income earners than from high- income earners.
Proportional tax- requires the same percentage of a person’s income; tax is levied from all taxpayers, regardless of their income amount. 
Income
Amount of Tax
% of Income Paid in Tax
$50,000
$15,000
30%
$75,000
20%
$100,000
$10,000
10%
Income
Amount of Tax
% of Income
Paid in Tax
$50,000
$5,000
10%
$75,000
$7,500
$100,000
$10,000

16. Activity 2.1 “Bonus Spending”
Students: use your Georgia Occupational Profile Card for this activity.
Each student receives a “$10,000” bonus for taking Econ!
Students should select a legal good or service to purchase in Georgia with their $10,000 of additional disposable income.
Record four other students’ annual income and the item they would like to purchase with their $10,000 bonus on Handout 1.
Students should calculate the price of their desired item + sales tax (4%)
Determine the tax burden for each of the four participants ($400/annual income x 100= % of income paid in tax)

17. Common Taxes in Georgia
The individual income tax is a progressive tax on a portion of the income a person or a married couple earns in salaries, wages, or investments.
The individual income tax is Georgia's top revenue source, generating between 40 and 45 percent of the state's total revenue
The chart represents what a household with $99,000-$99,999 of annual income would pay in income tax in Georgia for the 2016 fiscal year. The numerical values in the three columns to the right of the income level corresponds with the amount of income tax owed to the state. (Mathematical note: married filing separately, $5813/$99,100= 5.865%; $5867/$99,999= 5.867%...thus, the tax is progressive within each income bracket as well).
Georgia’s #1 source of government revenue is the individual income tax!
Optional: display two copies of the “2016 Georgia Income Tax Table” handout and have students locate their income tax rate as a Single tax filer to discover the progressive nature of income taxes

18. Common Taxes in Georgia
The general sales tax (or "sales and use tax") is a regressive tax placed on customer purchases of most items bought at retail stores.
The sales tax is a percentage of the price of an item. Georgia has a 4 percent sales tax rate, but because local governments are allowed to add on optional sales taxes, customers may pay up to 7 or 8 percent on retail sales.
The state revenue department collects all of the sales-tax revenue and returns the local portion to the appropriate counties, cities, and school systems.
Sales taxes are the 2nd leading tax source in GA generating about 30% of state revenues
Some retail items, especially most food products, have been exempted from the state sales tax. Before exemptions for food items were enacted, the sales tax was the leading tax source in Georgia; now, it is second, usually generating about 30 percent of the state's revenues.
Sales taxes are regressive because they impact lower income earners more than higher income earners!
Digby, Michael F. "State Revenues in Georgia." New Georgia Encyclopedia. 03 August Web. 09 May 2017.

19. Common Taxes in Georgia
Excise taxes are sales taxes (a regressive tax) placed on the purchase of such items as gasoline, alcoholic beverages, and tobacco products.
Excise taxes are usually fixed amounts per item rather than percentages of the price.
Digby, Michael F. "State Revenues in Georgia." New Georgia Encyclopedia. 03 August Web. 09 May 2017.
The motor-fuel tax is the largest excise tax, contributing about 4 to 5 percent of state revenues. The Georgia Constitution specifies that the state must spend whatever amount is raised by the motor-fuel tax on roads and bridges.

20. Common Taxes in Georgia
The property tax is a proportional tax paid by residential and commercial property owners to fund local public goods such as education and fire protection.
Each county and/or city creates the rate at which properties are taxed. Therefore, the assumption is that people pay a proportional percentage of their property’s value.
Property taxes are calculated using a millage rate and 40% of the market value of a home or property. See Teacher Background notes for details about millage rate and property tax assessment and collection.

21. CLOSURE ACTIVITY 2.2: Categorize common taxes and fees by tax type
Team up with 2-3 people in your area
Each team will be given a set of cards
Your job is to categorize each card into one of the three types of taxes: Progressive, Regressive, or Proportional
Once you have them where you think they should go, write it down on a piece of paper with your names and give it to Mr. Harris.

23. Some more tax info on Georgia

24. Non-tax Revenues- fees, licenses, & lottery
Whereas taxes are mandatory, fees and licenses are typically voluntary. All regulatory fee collections combined amount to 3 to 4 percent of state revenues.
The primary nontax revenue source in Georgia is the state lottery. With all of its various games, the lottery has on average contributed more than $700 million annually to the state budget since 2000.
The lottery is the state's third-largest revenue source, averaging 5 percent of total state funds each year. By law, lottery funds can be spent only for special programs, including the HOPE Scholarship for college and technical-school students, pre-kindergarten programs, and educational technology.
Digby, Michael F. "State Revenues in Georgia." New Georgia Encyclopedia. 03 August Web. 09 May 2017.

25. State-level Revenues

26. Georgia tax revenues by tax type (Fiscal Year- 2016)