Tax Reforms to “Promote” Saving would Backfire

There is a strong movement afoot to tax just consumption rather than all income. The “good reason” for this is to promote saving and investment, and thus enhance domestic capital formation, said to be the main force for economic growth, poorly defined but assumed to be a good thing. A battery of well-financed pols, along with many economists and divers publicists, are pushing it.

Insights Column in Groundswell June 2005

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