Tax rebates cause inflation because they result in more money available to chase an unchanged quantity of goods and services, which causes prices to rise. Simi

Tax rebates cause inflation because they result in more money available to chase an unchanged quantity of goods and services, which causes prices to rise. Similarly, tax increases reduce inflation because after paying taxes, people have less money to buy things that are not taxes. Critically: inflation measures the cost of goods and services, and taxes are not a good or service.