Where do our income taxes go when we pay them?

Question

I know there are several different taxes. The taxes on gas go to build roads and bridges etc. The tax on corporate gains goes to funding our wars..and etc. But what about federal income taxes? We (Americans altogether) pay out out TRILLIONS each week and yet we have a national debt and today central banks all around the world put money into their monetary systems to prevent a Credit Crunch...why? Intelligent answers only please and any sites you can show me for more information would be helpful.

Answer 1

Firstly, taxes exist for several reasons-
1 to control the economy- high taxes to reduce spending and prevent inflation and vice versa

2 to redistribute income-.high earners see their income taxed which is transferred to low income earners, through food stamps and other credits.


3 as you said- to pay for roads and in the case of America, to finance the war. why america has a national debt is primarily becaue of the war. trillions and trillions are spent, and this expenditure far exceeds the income received through various taxes, hence the debt. and then of course, the consumer themselves are guzzilng imports.

the money crunch comes about because of the huge deficit in america. Just imagine. who's giving all this money to amercica to spend? other countries are. Especially China and Japan, who finance Amercia's deficit by buying Amercia's bonds and bills.
Now can America pay all this? Just what is going to haapen if Amercai defaults on this debt? A credit crunch. That's what's going to happen. Banks in China and other lender countries will see all their loans unpaid, and as a result, savers in those countries will see their money lost.( becasue of the defaulted loans) this is the reason everyone is freaked about the credit crunch. . If america defaults, you might see your savings wiped out.

Sorry i really have no websites to give you. But i can give some books but i don't know whether they are avalible-
firstly J.K Galbraith - the 1929 crash.
The debt crisis by darrell delamaide

cheers!!
elin

Answer 2

THEY GO TO THE FEDERAL RESERVE BANKING SYSTEM (NOT A GOVERNMENT OPERATION BUT IN FACT A PRIVATE CORPORATION) TO PAY THE INTEREST ON THE MONEY THAT THE GOVERNMENT BORROWS FROM THEM FOR DAY TO DAY USE. THAT IS HOW THE GOVERNMENT DEPT HAS GOTTEN SO OUTRAGEOUSLY HI .
LOOK UP THE DEFINITIONS OF A NOTE.

Answer 3

I don't know where the money goes, but for what little I have to pay each year I am glad to pay it to support this great country that I live in.

Answer 4

Well, you've got to pay for all your political representatives, Homeland Security, all federally funded programs etc...just think of how much it must cost to keep this country running.