So Grandpa Death’s Labour Party Doesn’t Understand Tax Incidence Then

Either Jezza Corbyn’s Labour Party doesn’t understand tax incidence or they think that we don’t. That second might actually be true by the way. They’re suggesting that domestic rates – or is it council tax now? – should be replaced with something more progressive, something that accounts for the size of house and garden rather more than the current system does.

There are going to be problems here:

Jeremy Corbyn has unveiled plans for a new tax raid on middle-class homeowners which will see those with larger family homes and gardens pay significantly more.

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Don’t Mess With Markets – Turkey’s Stock Crash, 1,200% Interest Rate

The great lesson of the financial chaos enveloping Turkey is that you just don’t mess with markets. For they’re not some option, some taste or fashion, they’re the reality of what everyone’s thinking. Tell people they’re not allowed to think that way and they’ll carry on or worse, redouble their efforts to do so. This being the problem that all economic planners suffer from. They think all should be thinking as they do and get most upset when they don’t.…

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High Tax Rates Do Matter – They Deter Entrepreneurs

Heterogeneous – such an unlovely word. It just means that the effects depend. And what makes us richer as a society is the activity of entrepreneurs. Sadly, it being the activity of entrepreneurs which is dissuaded by high tax rates:

The heterogeneous tax sensitivity of firm-level investments: European evidence
Peter Egger, Katharina Erhardt, Christian Keuschnigg 25 February 2019

The effect of taxes on firm-level investments is very heterogeneous. This column shows that the impact of corporate taxation is up to 70% higher for entrepreneurial firms than for managerial ones, while dividend taxation negatively affects the investment of financially constrained firms but entails no significant impact on cash-rich firms.…

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