Federal Budget

Federal Spending - How is your money spent?

The Federal Budget is calculated yearly in order to provide enough capital to meet the financial year’s expected spending. This includes both Mandatory and Discretionary expenditures as well as paying off the interest of the National debt.
This segment provides ways to estimate and view your Federal Income tax and to understand the amount assigned and spent on the different financial categories within the Federal Budget. This allows for complete transparency and provides understanding in tangible financial terms on how your Federal Taxes are spread between specific key frameworks, National Security, and PEST objectives (Political / Economic / Social / Technology / Logistic / Environmental).

Mandatory Spending

These include any spending that funds the baseline for key financial functions and allows for the sustainability for social safety nets, including:
  • Transportation
  • Veterans Benefits
  • Food and Agriculture
  • Medical and Health
  • Social Security, Unemployment and Labor

Discretionary Spending

Spending that must happen to allow for yearly aims (security, infrastructure, pastoral, social development etc.). These may also support certain mandatory expenditures to allow for emphasis or relief in accordance with PEST (Political / Economic / Social / Technology / Logistic / Environmental) changes. Discretionary spending includes:
  • Science
  • Energy and Environment
  • International Affairs
  • Housing and Community
  • Transportation
  • Education
  • Food and Agriculture
  • Veterans Benefits
  • Government
  • Military
  • Medical and Health

Other than Mandatory and Discretionary expenditures, the Federal Government must also allocate funds in order to repay the interest on its debts (which are repaid through interest and income from other Federal assets).
The yearly Federal budget is approximately 4 trillion dollars. A number this large means little to the average person. In order to give an outline of Federal spending and how it relates to the Federal Income Tax paid, we have improved the Tax Form Calculator to give an outline of tax in tangible terms that relates to your Federal tax deductions.
The tables and pie charts below reveal how a person’s Federal Tax is allocated into the specific expenditure areas. This allows anyone to see how much of their yearly earnings paid to their Federal tax return is spent and where.