As we continue our discussions regarding revenue's associated with public sector, this will help reinforce some of the ideas regarding taxes on goods and services. Through the next week, save your receipts for purchases you make over the next seven days. Once you've compiled your receipts, add the totals up (both for the purchases you made and the taxes you paid for those purchases). Once you've compiled the totals, divide the amount paid in taxes by the total for the purchases of the goods and/or services (less the tax amount). This total should give you the percent you paid in taxes. Take the dollar amounts and multiply times 52 to give a "rough" idea for how much you pay annually for goods and services as well as the taxes on those good and services. Once you compute your "annual" payment of taxes, consider this total and, based on our discussion of the governmental use of revenues associated with these payments, do you feel you get your money's worth based on this "investment"? Explain some of your observations in a short (two page) narrative. Don't worry, I won't ask what you actually purchased, where or why. Have some fun with this assignment and don't be afraid to discuss with family, friends or associates. Here's an example: Over the last week, my wife and I purchased a total of $630.37 worth of goods and services based on our receipts. The receipts also show that the taxes paid equate to $54.21 in taxes, Based on these figures, we paid an approximate tax rate of .086 or 8.6%. $54.21/630.37=.086100=8.6% If I multiple the total taxes paid ($54.21 ) by 52 then I approximate the total taxes I pay annually on goods and services ($54.2152)=$2,818.92 annually. This is a rough approximation since I didn't make any major purchases last week and the "holiday" season hasn't started yet! To account for this, I can even add a "multiplier" figure to help strengthen the approximation. In my case, I'm adding a multiplier of .2 to account for "seasonal" fluctuations throughout the year. In my case, with the multiplier, I compute total taxes on goods and services for us to be about $3,382.70 ( $2,181.92 x 1.20). So ... our contribution to "primarily City of Tucson" expenses equates to about $3,400 annually. I live in the County, so the City services I receive for these payments primarily include transportation in the form of useable and safe roads, safe food at restaurants, subsidized golf at Reid Park golf courses, and use of the jogging path at both McDonald and Udall Parks. I also know that Public Safety will provide both Fire/Medical and Police services if needed; we didn't actually use any of these services, however a safe community is a real confidence builder. In our case, the tax rate of 8.6% provides both my wife and I confidence to live, recreate and work in the Tucson area. That said, there are some roads that I avoid due to both the condition and potential for congestion. We couldn't necessarily pay for any of these provided services on our own, so part of the "payment" is to have the City provide these for us at a reduced "total cost" since they receive the economies of scale reflected in the total number of individuals that pay these taxes annually. I'll discuss some other "payment vs cost" issues in class next week too