TEXAS GOVERNMENT FINAL EXAM REVIEW—SPRING 2009—okay, so I lied just a tad. The final is basically the equivalent of cutting and pasting the first three exams, plus some new stuff on taxation.  But just because the wording has changed some doesn’t mean there is much difference in the answers.  Use the other exam reviews for supplementing this one! There’s more on the final from them, anyway!

Biennial Budget: State budget proposed once every 2 years, or each regular legislative session

General Sales Tax: Texas’ primary source of state revenue; current rate is 6.25%

                Local Sales Tax rates can not exceed 2%; generally cities are not allowed to charge more than 1%, and county and other taxing authorities take the additional 1%

Selective Sales Tax: taxes imposed only on certain items and generally included in the listed price; e.g., the $1.41 cigarette tax, the motor-fuels tax (second only to federal funds in generating revenue used to build highways and bridges, etc.), and the alcohol tax

                Some of these selective sales taxes fall into the category of “sin taxes” that are designed to regulate consumption of a particular product or discourage its use altogether

Property Tax: Local governments’ primary source of revenue.  Property tax rates tend to be higher in areas where there is little or worthless property and lower where there is property in abundance or worth quite a bit; property taxes are not statewide

No Income Tax, Anywhere in Texas!!!

Ability-to-Pay Taxes: taxes aimed at those who have enough money to afford luxury items

Federal Grants: Texas’ second most important source of state revenue

Limitations on Borrowing: state may not borrow money except in emergencies and only then with 2/3 consent of the legislature

Public Education: the single-largest area of state spending per year

Fees: special sum charged for use of a government service, such as parks, recreational facilities, etc.