Federal Spending - Where is your money spent?

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Federal Spending - How is your money spent?

Every year the Federal Budget is calculated with the aim of providing sufficient capital to meet the planned expenditure throughout the financial year. The budget includes Mandatory and Discretionary spending and allows for the payment of interest on the National debt.

In this section we provide the tools that enable you to calculate and view your Federal Income tax and see exactly how much is allocated and spent on specific financial categories within the Federal Budget. The aim here is to provide transparency and allow you to understand in real financial terms how your Federal Taxes are split to support specific key infrastrucutre, National Security and other key PEST objectives (Political / Economic / Social / Technology / Logistic / Environmental).

You can enter your annual salary and select your state to see the amount of Federal Income Tax payable and expenditure breakdown or select a predefined budget breakdown based on specific example salaries by selecting the appropriate salary amount further down this page.

2024 Federal Budget Expenditure in relation to Federal Income Tax Calculator
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Federal Tax Calculator

Mandatory Spending

Expenditure which must occur to facilitate a fiscal baseline for key financial functions and ensure social safety nets are sustained, these include:

  1. Transportation
  2. Veterans Benefits
  3. Food and Agriculture
  4. Medical and Health
  5. Social Security, Unemployment and Labor

Discretionary Spending

Expenditure which must occur to facilitate annual objectives (security, infrastructure, pastoral, social development etc.), these may compliment specific mandatory expenditure to provide focus or relief in response to PEST (Political / Economic / Social / Technology / Logistic / Environmental) changes. Discretionary expenditure includes:

  1. Science
  2. Energy and Environment
  3. International Affairs
  4. Housing and Community
  5. Transportation
  6. Education
  7. Food and Agriculture
  8. Veterans Benefits
  9. Government
  10. Military
  11. Medical and Health
image depicting a robot programming the Federal Budget calculation to show the expenditure per financial category for the transposed cost to a tax payer earning 0.00 per year

In addition to Mandatory and Discretionary spending the Federal Government must also budget for the repayment of interest on its debts (which are also repaid via interest and revenue from other Federal assets).

The Federal budget is circa 4 trillion dollars a year, a big figure that means very little to most people, it's just a bunch of numbers. So, in response to the request for a breakdown of Federal spending in respect of Federal Income Tax paid, we have refined the Tax Form Calculator to provide a breakdown of tax in real terms that related to your Federal tax deductions. The pie charts and tables below show how your Federal Tax is split into the respective areas of spending so you can see how much of your annual earnings paid in your Federal tax return is spent and where.

Examples of Federal Expenditure as a Percentage of Income

The following examples provide a breakdown of the financial expenditure by the Federal government as a specific percentage and amount based on a full income tax calculation for the annual salary specified.