Learn Liberty | Can the government raise taxes? @LearnLiberty | Uploaded January 2023 | Updated October 2024, 17 hours ago.
It turns out the government can’t raise taxes at all, it can only raise tax rates. Taxes are what happens when the tax rate that the government impose interacts with people’s behavior.
This is perhaps the most interesting picture in all of economics. It’s interesting precisely because it’s so boring. What you’re seeing here is federal tax receipts.
This is all tax revenue from all sources combined, payroll taxes, income taxes, estate taxes, tariffs, everything, federal taxes, all sources combined, as a fraction of GDP. What you see is, from 1950 up to the present, this has remained relatively stable at about 17%. That is, over time, if you think of the economy as a pie, the government has collected a constant 17% slice of this economic pie.
LEARN LIBERTY:
Your resource for exploring the ideas of a free society. We tackle big questions about what makes a society free or prosperous and how we can improve the world we live in. Watch more at learnliberty.org/.
It turns out the government can’t raise taxes at all, it can only raise tax rates. Taxes are what happens when the tax rate that the government impose interacts with people’s behavior.
This is perhaps the most interesting picture in all of economics. It’s interesting precisely because it’s so boring. What you’re seeing here is federal tax receipts.
This is all tax revenue from all sources combined, payroll taxes, income taxes, estate taxes, tariffs, everything, federal taxes, all sources combined, as a fraction of GDP. What you see is, from 1950 up to the present, this has remained relatively stable at about 17%. That is, over time, if you think of the economy as a pie, the government has collected a constant 17% slice of this economic pie.
LEARN LIBERTY:
Your resource for exploring the ideas of a free society. We tackle big questions about what makes a society free or prosperous and how we can improve the world we live in. Watch more at learnliberty.org/.
