15 Jul 2023 5:42 am
Friedman believed government was too large and intrusive, and that by cutting taxes, the size of government would be reduced.
Our disagreement lies in the ability of any tax cuts to achieve their prescribed ends: namely shrinking the size of government. Remember, it was not tax cuts per se that Friedman advocated but rather a retrenchment in the state.
Our view, which we developed in a recent study entitled Tax Payers and Tax Takers, is that tax relief that results in larger and larger shares of the population being exempt from paying any meaningful taxes leads to more demand, not less, for government.
The trouble with removing large numbers of people from the cost of paying taxes is that it establishes the foundation for ever-increasing demand for more government programs regardless of their actual benefits. The democratic decision-making process gets distorted when large segments of the population are relieved of paying the cost of government.
An example of this phenomenon is playing out in the U.S. In 2011, according to the Tax Policy Center, a little more than 46 per cent of American tax units individuals or households paid no federal income tax. Almost 28 per cent paid neither income nor payroll taxes.
https://www.fraserinstitute.org/article ... -cuts-good
Our disagreement lies in the ability of any tax cuts to achieve their prescribed ends: namely shrinking the size of government. Remember, it was not tax cuts per se that Friedman advocated but rather a retrenchment in the state.
Our view, which we developed in a recent study entitled Tax Payers and Tax Takers, is that tax relief that results in larger and larger shares of the population being exempt from paying any meaningful taxes leads to more demand, not less, for government.
The trouble with removing large numbers of people from the cost of paying taxes is that it establishes the foundation for ever-increasing demand for more government programs regardless of their actual benefits. The democratic decision-making process gets distorted when large segments of the population are relieved of paying the cost of government.
An example of this phenomenon is playing out in the U.S. In 2011, according to the Tax Policy Center, a little more than 46 per cent of American tax units individuals or households paid no federal income tax. Almost 28 per cent paid neither income nor payroll taxes.
https://www.fraserinstitute.org/article ... -cuts-good