Wednesday, April 16, 2008

So how does this work...

I'm puzzling over how the Republicans work this out. If you cut taxes, it will actually raise the revenue of the federal government. That's the theory. So I can see that if you cut taxes, that means more money in the pockets of people, and thus more spending might go on. That would mean more sales tax income for the government. Right?

But see, if the government gets more income later, then that means it got more in taxes, right? So it's a circular argument; cutting taxes means more sales, which means more tax income.

Am I missing something?

2 comments:

Isis said...

Yes, you see, if we cut 9 inches off the top of the blanket and sew it to the bottom we increase the length of the blanket....

Anonymous said...

Less taxes = more money for business expansion = more jobs and more company profits to be taxed. You are confusing "higher tax rates" with "more taxes collected". It has been proven that, if the government leaves more money in the hands of the people, they will use it to expand the economy.