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Tax breaks are considered government spending. Spending money and giving tax breaks has the same effect on the books, the government has larger deficits/smaller
by stormbrew 13y ago
Tax breaks are considered government spending. Spending money and giving tax breaks has the same effect on the books, the government has larger deficits/smaller surplus, and the goal is the same: to support or encourage behaviour which benefits the government or its citizenry.
http://en.wikipedia.org/wiki/Tax_expenditure#The_politics_of_tax_expenditures http://en.wikipedia.org/wiki/Tax_expenditure#The_politics_of...
- abalone 13y agoThat is not some universal law. It is a convention that assumes a certain scenario, namely where the government has been receiving a certain amount of tax revenue which they will now lose by giving a break. In a scenario where a crazy new tax was passed that was never enforced, then noticed a few years later and abolished because enforcing it would blow up an entire local industry, it is a stretch to categorizing it as "spending". That'd be like writing a note you're owed $1B, tucking it in a drawer, and then when it's ripped up a few years later saying you just "spent" a billion dollars. The city never had the tax revenue to begin with.