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Year 10

Why should we pay tax?

I can explain the different types of tax and arguments in support and counter arguments for equal taxation.

icon-background-square
New
New
Year 10

Why should we pay tax?

I can explain the different types of tax and arguments in support and counter arguments for equal taxation.

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Lesson details

Key learning points

  1. Taxation is the primary method by which governments generate revenue to fund public services.
  2. The UK tax system comprises various forms, including Income Tax, National Insurance, VAT and Corporation Tax.
  3. A progressive tax system ensures that individuals with higher incomes contribute a greater proportion.
  4. Advocates for equal taxation emphasise simplicity and consistency.
  5. Critics highlight its disproportionate impact on lower income groups and the importance of wealth redistribution.

Keywords

  • Tax - the charges imposed by the Government on citizens and corporations to finance some of its spending

  • National Insurance (NI) - contributions paid from money earned to enable individuals to qualify for certain benefits and the state pension

Common misconception

Everyone pays the same percentage of Income Tax.

Income Tax is on a progressive scale so the percentage of income tax you pay depends on how much you earn.


To help you plan your year 10 citizenship lesson on: Why should we pay tax?, download all teaching resources for free and adapt to suit your pupils' needs...

You could develop the final task and include a deliberative discusson or debate about whether a progressive tax system is more fair than a flat tax system or not.
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This content is © Oak National Academy Limited (2025), licensed on Open Government Licence version 3.0 except where otherwise stated. See Oak's terms & conditions (Collection 2).

Lesson video

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6 Questions

Q1.
Match the types of tax to their descriptions.
Correct Answer:Income Tax,a tax paid by individuals based on their earnings
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a tax paid by individuals based on their earnings

Correct Answer:Council Tax,a local tax paid by homeowners and renters for public services
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a local tax paid by homeowners and renters for public services

Correct Answer:Corporation Tax,a tax paid by businesses on their profits
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a tax paid by businesses on their profits

Correct Answer:Excise Duty,a tax on goods such as alcohol, tobacco and fuel
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a tax on goods such as alcohol, tobacco and fuel

Q2.
Each year, the Government sets out its financial plans in a document called the ...
Correct Answer: Budget
Q3.
The Government raises money through six main areas, including taxation, borrowing and debt, natural resources, national assets, fines and fees and ...
Correct Answer: investments, profits, investments and profits, profits and investments
Q4.
Which of the following services is primarily funded by the UK Government?
supermarkets
Correct answer: healthcare
airlines
mobile phone networks
Q5.
Match each financial term to its correct definition.
Correct Answer:surplus,when government income is higher than spending
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when government income is higher than spending

Correct Answer:deficit,when government spending is higher than income
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when government spending is higher than income

Correct Answer:revenue,the total income a government collects, mainly from taxes
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the total income a government collects, mainly from taxes

Q6.
Why does the Government issue bonds?
to collect donations from the public
to allow private companies to take over public services
Correct answer: to borrow money that must be repaid with interest
to encourage people to save money

6 Questions

Q1.
Match the terms to their correct definitions.
Correct Answer:Personal Allowance,the amount you can earn tax-free each year
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the amount you can earn tax-free each year

Correct Answer:National Insurance (NI),money taken from earnings to qualify for benefits and pensions
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money taken from earnings to qualify for benefits and pensions

Correct Answer:Value Added Tax (VAT),a tax added to goods and services at the point of purchase
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a tax added to goods and services at the point of purchase

Q2.
tax systems result in people with higher incomes paying a greater proportion of their income in tax.
Correct Answer: progressive
Q3.
What is the primary purpose of taxation?
to reduce the amount of money in circulation
Correct answer: to generate revenue
to increase the profits of private companies
to discourage consumer spending
Q4.
How much money can most people in the UK earn before they start to pay Income Tax?
£10,250
Correct answer: £12,570
£15,720
£20,715
Q5.
What is one argument in favour of a flat tax system?
It allows lower earners to pay less tax.
It prevents businesses from making profits.
It ensures that wealthy individuals pay more.
Correct answer: It ensures simplicity and consistency.
Q6.
Why does the Government fund public services such as education and healthcare through taxation?
Correct answer: to ensure everyone has access, regardless of income
to increase the profits of private companies
to encourage people to pay for private services instead
to provide services only for those who contribute the most tax