Will raising taxes always increase tax revenues and will cutting taxes always decrease tax revenues?

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  • 11 months ago
    Favorite Answer

    No. Think of it in the extreme. If taxes were raised to 100% of income, then there would be no incentive for people to work. Nobody working means no taxes to collect. It works through the tax levels as well. You have to let money flow in the market to create jobs, income, spending, and therefore tax revenue.

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  • 11 months ago

    No an increase in taxation is not the same as an increase in the government revenue.

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  • RICK
    Lv 7
    11 months ago

    To a certain extent yes

    Raising taxes will increase revenue up to a certain point which is 100% taxation

    However any and every tax cut has reduced revenue

    Currently the high income earners and the passive income earners are grossly under taxed (in the US)

    The next tax law needs to tax deferred interest, qualified dividends and capital gains as regular income

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  • Judy
    Lv 7
    11 months ago

    no not always - sometimes the base amount changes

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  • 11 months ago

    No to both. It may affect behavior that generates tax revenue

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  • 11 months ago

    No, not always. Right now, yes, because taxes are so low. Raising taxes above 90% would decrease revenue. But increasing them to normal level would increase revenue.

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  • Anonymous
    11 months ago

    Somebody has to pay for all these wars and tax cuts. So yeah, raise taxes.

    • tiescore
      Lv 6
      11 months agoReport

      Sorry I have a limited discretionary income and a ton of things to finance with it. Government can stop being so generous to illegals, and those that refuse to work thank you very much.

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