Foundation of education 8


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Foundation of education 8

  1. 1. 1 Subject :Foundation of education Lecturer : Soeung Sopha Chapter 8 Financing Public Education Prepared by : Phien Davy Chan Houng Meas Chanleakhena 2013-2014
  2. 2. 2
  3. 3. What is tax? Tax is a financial charge or other levy imposed upon a taxpayer (an individual or legal entity) by a state or the functional equivalent of a state such that failure to pay is punishable by law. 3
  4. 4. What is finance? Provide money needed for something to happen. 4
  5. 5. Outline - Introduction - Tax Sources of School Revenues…..(p237) - Local Financing for Public Schools...(p237-240) - State Financing of Public Schools….(p240-247) - Federal Education Funding…………(p247-250) - School Finance Trends………….......(p250-255) 5
  6. 6. Introduction Education in the United States is the big business. By 2006, public education (k-12) cost more than $520 billion annually, and elementary and secondary school education represented approximately 4 percent of the nation’s annual gross domestic product. 6
  7. 7. Federal Education Funding State Financing of Public Schools Local Financing for Public Schools 7
  8. 8. Tax Sources of School Revenues Public school funding relies primarily on revenues generated from taxes, especially local property taxes and state sales and income taxes. 8
  9. 9. Most people today accept the following criteria for evaluating taxes: A tax should not cause unintended economic distortions. A tax should be equitable: -Those with greater incomes or with greater property worth should pay more taxes are called progressive taxes. - Those that require lower-income groups to pay a higher proportion of their income than higher- income groups are called regressive taxes. 9
  10. 10. A tax should be easily to collected The tax should response to changing economic conditions, rising during inflation and decreasing in a recession. 10
  11. 11. Local Financing for Public Schools 11
  12. 12. Local Financing for Public Schools Property Tax is the main source of revenue for local school districts, accounting for 77 percent of local funding nationwide. 12
  13. 13. Problems with property tax: The property tax is not an equitable tax because differing assessment practices and lack of uniform valuation. Also, the property tax may fail to distribute the tax burden according to ability to pay. 13
  14. 14. Other Sources of Local Funding Some Municipalities, specially small villages and towns, depend on such sources as traffic fine and building permits to help raise money for school 14 User Fees Exclusive product rights
  15. 15. Other Sources of Local Funding User Fees-fees charged to use a certain facility or service-are the most common type of special assessment. Exclusive product rights: A growing number of school boards have signed lucrative contracts with corporations for Exclusive product rights and exclusive naming rights. 15
  16. 16. Local resources and Disparities Wealthy versus poor districts - Wealthy area or an area with a broad tax base generates more revenue than a poor school district. - As a result, in most states, the five wealthiest school districts often spend two or three times more per student than the five poorest school districts do. 16
  17. 17. Municipal overburden - Cities are plagued by what commonly called municipal overburden. - A severe financial crunch caused by high population density, a high proportion of low-income citizens, and aging infrastructure. - Spending needed for social services and upkeep prevents large cities. 17
  18. 18. Educational overburden - English language learners, students in poverty, and students with disabilities often require programs and related services that might cost 50 to 100 percent more per student than basic programs. Urban cycle of financial strain - Dire need more revenues, city can not realistically rise taxes. 18
  19. 19. - Tax increases contribute to the decline of urban schools because they cause business and middle-income residents to depart for suburbs. - Declining city’s tax base due to lack of revenues also cause residents to leave-a no-win situation. 19
  20. 20. Tax collection performed by government agency - General Department of taxation - General Department of custom and Excise of Cambodia. Taxpayer are divided in 3 regimes - SelfAssessment System/ Regimes - OfficialAssessment System/ Regimes - SimplifiedAssessment System/ Regimes. Component of Tax Revenue - Direct Tax - IndirectTax 20 Cambodia Taxation
  21. 21. State Financing of Public Schools 21
  22. 22. State Financing of Public Schools Although the states have delegated many educational powers and responsibilities to local school districts. each state remains legally responsible for educating its children and youth, and state’ portion of education funding has increased steadily elementary and secondary education. 22
  23. 23. State Revenue Sources 23 Sale Taxes Personal Income Taxes
  24. 24. • Sale tax compare favorably to other possible fund-raising taxes. • Sale tax is easy to administer and collect . • The sale tax is also elastic, because the revenue derived from it tend to parallel the economy. Sale Tax evaluated • Based on progressive percentage of personal income. • Also more equitable than other. Income Tax evaluated 24
  25. 25. Sale Tax in Cambodia • Cambodia’s VAT applies to the business activities of real regime taxpayers making taxable supplies. In each case the business must charge VAT on the value of goods or services supplied. - The rate 10 % • Patent Tax Annual registration or license fee impose on all kind of business, industries and service. 25
  26. 26. • Personal income tax = salary tax (Cambodia) • Salary tax is monthly imposed on salary that has been received within the framework of fulfilling employment activities. Salary tax rate in Cambodia Rate Form 0$ To 500,000 0% Form 500,001$ To 1,250,000 5% Form 1,250,001$ To 8,500,000 10% Form 8,500,000$ To 1,250,000 15% > 1,250,001 20% 26
  27. 27. Other State Taxes Other State Taxes contribute limited amounts to education. Those include • Excise taxes on motor fuel, liquor, and tobacco products. • Estate and gift taxes • Severance taxes • Corporate income taxes. 27
  28. 28. States’Ability to Finance Education State residence has a lot to do with the type and quality of education a child receives. State variations in spending is different from one state to other state. 28
  29. 29. State Aid to Local School Districts State use four methods to finance public education. 29 Flat grant model(the oldest, unequal method) Foundation plan(a minimum per student) Power equalizing plan(inverse ratio to wealth ) Weighted student plan (student weighted by characteristics)
  30. 30. The Courts and School Finance Reform • Serrano v. priest (1971) • San Antonio v. Rodriguez (1973) • State court decisions 30
  31. 31. Federal Education Funding 31
  32. 32. Federal Education Funding • Until the middle of twentieth century, the federal government gave states or public schools little financial assistance in educating American students. • After Soviet Union, nation policy become more closely link to education and federal funding • The Civil Right Act of 1964, which provided that all programs supported by federal fund must be administered and operated. • In addition to these desegregation efforts the educational need of minority groups and women received 32
  33. 33. Current Trend in Federal aid to Education Federal education spending declined over the course of decade. School funding methods also change. 33 Categorica l Grants Block Grants
  34. 34. • The trend toward more categorical funding gained momentum as we entered the new millennium . - No Child Left Behind (NCLB) - Adequate Yearly Progress (AYP) - The Obama Administration 34
  35. 35. School Finance Trends •Finance crises in education often make the headline. •Coupled with rising cost and other budgetary problems, loss of state revenue has placed many local school districts in bleak fiscal situation. 35
  36. 36. Taxpayer Resistance Taxpayer initiatives A tax revolt swept the country, putting a damper on the movement for school finance reform. Results of taxpayer resistance Taxpayer willing to support increased education spending for that purpose. 36
  37. 37. The Accountability Movement Reasons for the accountability movement The accountability movement stems from various factors. Federal and state measures Federal funding is now contingent upon evidence of satisfactory educational progress. 37
  38. 38. Tax Credits, Educational Vouchers, and School Choice Tuition tax credit Allow parents to claim a tax reduction for the education expenses they pay in order to send their child to nonpublic school. Educational vouchers Is another ongoing trend in school in school finance reform. 38
  39. 39. Charter schools A variation on the school choice theme is concept of charter schools, discuss in the chapter on Governing and Administering Public Education. 39
  40. 40. Streamlining School Budgets New search on school size 1. School size Maintaining old facilities 2. Modernization of older building Adding more teachers 3. Need for teachers Streamlining central staffs 4. Administrative reduction 40
  41. 41. Streamlining central staffs 4. Administrative reduction Reducing energy costs 5. Energy economic 41
  42. 42. School Infrastructure and Environmental Problem Deteriorating Asbestos cleanup More classroom will be needed 42
  43. 43. Financing Public Education in Cambodia In Cambodia 12.4% of government spending is in education. Education makes up a small part of the Government annual spend, and the problem is that in absolute terms, this expenditure is very low. Just 1.6% of Cambodia's GDP (Gross Domestic Product) according to UNESCO is spent on education - ranking around 170th in the world.  The Revenue Sources • The priority action programmes (PAP) in 2000. • The Ministry of Education, Youth and Sports (MoEYS) • NGO 43
  44. 44. Discussion Question 1. State your reasons for or against the following types of financial support for school choice: a) Government voucher that any student can use to pay tuition in any accredited school, public or private. b) Voucher as in (a), but issued only to students whose families demonstrate financial need. c) No voucher for private or parochial school, though student are free to choose any public school they like. 44
  45. 45. Thank You! 45