Tax Cuts And Revenues

Does reducing income tax lead to more money for governments? Those on the right say yes, and those on the left appear not to believe the claim. Why else would those on the left make campaigning to raise taxes careers?

The right is a champion of small government, and it sees reducing taxes as a vehicle for shrinking government. But if the right is correct that lowering taxes increases government revenues, then the right is advocating a policy that undermine its desire for small government.

Perhaps the true aim of the right is for workers to keep most of what they earn, as a matter of principle, and the argument about increasing revenue is a just a smokescreen to weaken opponents of tax cuts.

There are studies that say tax reductions have led to increase in revenues, but there are so many confounding variables that it is difficult to believe the results of the studies. For example, during the period of the studies, tax enforcement could have increased, many workers could have gotten salary increases, government spending could have decreased or changes in the economic landscape made investment more attractive.