Tax deductions as a tactic of supply side economics:.
Stimulating the growth of an economy.
The purpose of this paper is to examine the use of government tax cuts, as one.
tactic of supply side economics. The pros and cons to supply side economics with.
reference to historical evidence will show that cutting taxes as prescribed by this plan will.
in fact stimulate economic growth. Does it work? The people of Ontario are going to.
find out. .
Supply side economics is a theory geared towards the economic health and.
constant growth of an economy by influencing the supply of labor and goods. While.
many economists would seek economic health through a greater concern for gross.
national product,supply siders? believe in measures which increase the incentive to.
work and to produce goods and services. The means by which economic growth is.
achieved, is by maintaining capital and the freedom of entrepreneurship. .
One tactic of supply side economics is tax cuts. Decreased taxes are a key factor.
directly related to the growth of the labour force. Lowering of taxes, tends to stimulate.
the economy in such a way that the production of goods and services is increased without.
a rise in inflation. As a result of increased productivity, worker's wages will begin to.
increase. .
Fourteenth century Moslem philosopher, Ibn Khaldun, stated:At the beginning.
of the dynasty, taxation yields a large revenue from small assessments. At the end of the.
dynasty, taxation yields a small revenue from large assessments? (Gonick 119). At a high.
tax rate less people will be willing to produce goods and services, but at a lower tax rate,.
incentives to produce are increased.1 Supply siders believe that this methodology of.
cutting income taxes will increase overall government revenues in the long run through.
the increased spending by the consumer. Innovation and entrepreneurship are encouraged.
moreso in an economy with low taxes because there are greater chances for success.
