You go to your favorite restaurant and look at the menu. There, you see all of your favorite foods with their prices listed next to them. When you go to pay the bill, do you pay that exact price? No, because you must pay tax on the food and drink you purchased. You might also find that if the restaurant is a chain, and you bought the same items in another city or state, the tax might be different.

If instead you went to the grocery store and bought all the ingredients and cooked the food yourself, your tax bill might be lower depending on where you live. Taxes on food from restaurants and grocery stores are set at the state and local level and vary from place to place.

Why do taxes vary and what do the counties and states do with the tax revenues that they collect?

Types of Taxes

Food tax, beverage tax, gift tax, estate tax! What are all these taxes and where do they apply? Watch this presentation and learn about all the different types of taxes that states and localities can levy on different activities. You may be surprised how many different things are taxed.

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State and Local Taxes

By what authority do states tax? Where does it say in the Constitution that the city can charge tax on your hamburger? Learn about the justification for taxes and how different states have different tax policies when it comes to things like income and sales tax in this presentation.

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When you wonder where the money comes from to fund most of the things that your local and state governments provide, remember that local governments depend primarily on property taxes, and the state governments depend on sales and income taxes.