How Does the State Government Use Tax Money

Every year, the questions come up of how does the government use tax money. For many people it is just a simple question with two answers; yes and no. While most people understand that the U.S. government has to use tax payer monies in order to operate, provide services, provide national security, protect the nation and maintain our way of life, they really don’t know how the government goes about getting these funds.

The truth is that the government doesn’t have to use tax payer money. They could simply create a list of every single person who pays their taxes and then let those individuals know that they are going to be cut off from all government benefits and services unless they get their taxes done on time. This would cause many individuals to take care of their taxes while others would go down the street to the tax office and pay their taxes there. This system has not worked very well over the years, and it never will, because there are far too many individuals who just refuse to pay their taxes no matter what the government says.

One of the best ways of how does the state government use tax money is to create programs and services to help the poor without creating more government programs or spending additional taxpayer money. A perfect example of this is Medicaid, the state run health care program for the poor. Each state is required to provide Medicaid benefits to individuals and families according to their income level. So if someone in a high-income family gets Medicaid, but then falls into poverty, they are not eligible to receive any help because their income is too low.