Question

For what reason might the united states government raise taxes instead of borrowing money to pay for a new government service

Answer 1

To avoid paying interest on savings bonds

Answer 2

The reason would be that if they borrow money, they also have to give this money back someday while if they just raise taxes, they basically will get the same money by taxing their population and won't have to return anything. It is true, however, that the people will be taxed more and that they will have to pay the price that the nation would otherwise pay.