That's how most economists view a tax exemption. An exemption means that ordinarily, this entity would be taxed, but because it is deemed to be special in some

That's how most economists view a tax exemption. An exemption means that ordinarily, this entity would be taxed, but because it is deemed to be special in some way, they get an exemption. From the perspective of an economist, that's money the government is giving up, which is no different than paying that money out.