Question #9795
Discuss what might happen in an economy if a government increases income tax rates.
Expert's answer
If a government increases income tax rates:
1) the government revenues will increase
2) it will decrease the economic activity of business, especially the small firms
businessmen.
3) total decrease in economy, decrease of inflation rates or even deflation.
1) the government revenues will increase
2) it will decrease the economic activity of business, especially the small firms
businessmen.
3) total decrease in economy, decrease of inflation rates or even deflation.
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