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"Compensate somewhat for the increase by lowering the actual tax rate." Why should we be "compensating" anything? "The Rich" promised to hire vigorously if we

• HeXetic 15y ago
  Because the Economist's point is that so much of the potential tax revenue is getting excluded due to loopholes that eliminating those loopholes without reducing the marginal tax rate at the same time would amount to an enormous wallop. Maybe "the rich" can bear it, maybe not, but the point is effecting change of that sort would make them pay more, and that regardless of what actual tax rate we want to target, it would be better to start from a position where the actual tax paid by any individual is straightforward to calculate. Only at that point does it become reasonable to figure out at exactly what number to set the tax rates, because until then you don't really know how much tax you're going to get from the person, since they may or may not have avenues of escape.