Federal government is a form of government in which several states unite together under one central authority. In USA, federal refers to the group of Northern States that have united together in case of a civil war. In such a case, the federal government levies some taxes from the people, like sales tax, income tax, value added tax etc. which are termed as federal taxes. Taxes levied by the state government on some or the other pretext are called state taxes.
In the words of Spencer Bacchus, “The rapid growth in many of our suburbs has spanned a booming consumer industry eager to hire low wage immigrants who gladly fill these jobs, many of them are happy to be paid in cash, free of federal and state taxes.” Taxes are something that every responsible member of the state or federal union must pay, in order to enjoy fully all the facilities that the state and federal government provided them.