Free, unrestricted use is allowed on a non commercial basis. The author's name and the address of this website must be incorporated in any reproduction of the material for any use and by any means. The government finances its budget mainly by taxing individuals and corporations. Ultimately, households pay the bill. Even corporations are owned by individuals and earn their money by selling products and services to individuals.
Higher taxes are likely to be passed on to customers or to employees.
There are numerous kinds of taxes, regressive and progressive, direct and indirect, on earnings and on property - but they all serve to finance the budget. In other words, the money that is lent to the government is not available to finance consumption, investments and working capital for businesses. The competition on the scarce resource of capital increases its price, interest rates. Recognizing these unfortunate results, governments the world over have been converted to the new religion of balanced budgets or, at least, reduced and controlled budget deficits. The two best known examples are the United States and the European Union.