Quote:
Originally Posted by Cool Beans
Increased taxes usually does not increase the revenue (usually decreases it)...
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This is perhaps one of the biggest urban myths ever pounded into our heads by conservative pundits.
Reagan certainly did cut tax rates and increased revenues, but a lot of this was restructuring of the tax code that spurred international investment here at home. A single event but a good example.
But most of the tax calculations used to prove this point don't factor in the growth in population or business cycles (i.e. bubbles) that have a huge impact on tax revenues. Clinton raised taxes and when you look at it per capita the revenues went up dramatically.
If cutting taxes always led to increased revenues then I'd say we should do away with them completely and enjoy the infinite revenues that would bring forth.
-spence