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Aren't taxes a zero sum game? If one "dodges" any amount the state must make up that revenue somewhere so the actors with finances and ability to best take adva

by comrh 11y ago

Aren't taxes a zero sum game? If one "dodges" any amount the state must make up that revenue somewhere so the actors with finances and ability to best take advantage of the system then end up not paying their fair share?

mathgeek 11y ago
While it is essentially a zero-sum game, there are many alternatives to "make up that revenue." Those include printing money, reducing expenditures, etc.
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jacquesm 11y ago
That's pretty much how it is, though with the way some governments work chances are that it would just lead to more squandered money and no reduced taxes for the ones making up the deficit. I've yet to hear of substantial tax decreases that were not carefully designed to be 'neutral' for the taxman. Every decrease in one tax was always offset by an increase in another or an entirely new tax.
deleted 11y ago
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fleitz 11y ago
Not at all, taxes should be used to make investments in the economy where the market fails, a government that spends wisely will grow its economy and thus its tax revenue without changing rates. A tax dodge is not unlike a government with lower tax rates. If the taxes not paid creates increased growth then tax will simply be made up in the future. Imagine two countries each with a $1000 economy, both have a 50% tax rate, but in one country every person 'dodges' 50% of their taxes, if that country grows its economy at say 3% instead of 2% then after 100 years two economies will be at $7,386.22, $20,068.17 thus the country with the tax dodgers will collect ~$5K in revenue while the other collects ~$3.5K
noarchy 11y ago
>Aren't taxes a zero sum game? If one "dodges" any amount the state must make up that revenue somewhere so the actors with finances and ability to best take advantage of the system then end up not paying their fair share? It seems that you're beginning with the assumption that the expenditures are all sensible or necessary, thus the "need" to make up the revenue. To be sure, a deficit is a deficit, but when we start talking about people paying their "fair share", they're probably going to want to know, "fair share of what, exactly?" If politicians keep spending themselves into debt, regardless of how much more money they extract from the population, can we speak of one's "fair share" of the irresponsibility of the people holding the public purse?

by comrh 11y ago

mathgeek 11y ago

While it is essentially a zero-sum game, there are many alternatives to "make up that revenue." Those include printing money, reducing expenditures, etc.

deleted 11y ago
[deleted]

jacquesm 11y ago

That's pretty much how it is, though with the way some governments work chances are that it would just lead to more squandered money and no reduced taxes for the ones making up the deficit. I've yet to hear of substantial tax decreases that were not carefully designed to be 'neutral' for the taxman. Every decrease in one tax was always offset by an increase in another or an entirely new tax.

deleted 11y ago

[deleted]

fleitz 11y ago

Not at all, taxes should be used to make investments in the economy where the market fails, a government that spends wisely will grow its economy and thus its tax revenue without changing rates. A tax dodge is not unlike a government with lower tax rates. If the taxes not paid creates increased growth then tax will simply be made up in the future. Imagine two countries each with a $1000 economy, both have a 50% tax rate, but in one country every person 'dodges' 50% of their taxes, if that country grows its economy at say 3% instead of 2% then after 100 years two economies will be at $7,386.22, $20,068.17 thus the country with the tax dodgers will collect ~$5K in revenue while the other collects ~$3.5K

noarchy 11y ago

>Aren't taxes a zero sum game? If one "dodges" any amount the state must make up that revenue somewhere so the actors with finances and ability to best take advantage of the system then end up not paying their fair share? It seems that you're beginning with the assumption that the expenditures are all sensible or necessary, thus the "need" to make up the revenue. To be sure, a deficit is a deficit, but when we start talking about people paying their "fair share", they're probably going to want to know, "fair share of what, exactly?" If politicians keep spending themselves into debt, regardless of how much more money they extract from the population, can we speak of one's "fair share" of the irresponsibility of the people holding the public purse?