WhatFinger

Tax Policy: Cutting tax rates frees up capital to be deployed more productively in the private sector

Federal revenues jump from faster growth . . . more than twice what the tax cut was supposed to ‘cost’


Federal revenues jump from faster growth If there’s one thing every liberal will do when talking about tax policy (and most “moderates” and a fair number of “fiscal conservatives” as well), it’s to scoff at the notion that tax cuts can pay for themselves. The supply-side proposition has always been that it’s the growth of the economy, not tax rates, that determines federal revenues. If you look through history, you’ll see that federal revenues are usually right around 18 percent of GDP regardless of what the tax rates are, so the best policies the government can set are the ones most friendly to growth.
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