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Yes, this is rich

“Unproven” is the existence of deadweight costs of tax, which vary by type of tax. There are several Nobel Laureates who would disagree. Vehemently disagree with a retired accountant from Ely.

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Richard Murphy says:
July 23 2024 at 10:02 am
So, you think that studies that cobsider the ‘cost’ of tax without the bebefits they provide prove anything?

Yes.

Because the study of deadweights is the study of the relative costs of raising revenue in a particular manner.

If we raise £100 by taxing land values then that cost, in lost economic activity, low low and possibly even nothing. If we raise £100 by consumption tax then that deadweight is higher. By income taxation then higher again. By capital and corporate taxation then higher again.

That’s what the whole game of deadweights is about. The benefit of having the £100 to spend (or, MMT, in reducing the ionflation cause by the other £100 spent) is the same in every case. We are, specifrically and with malice aforethought, looking at the relative costs of the methods of taxation.

4 thoughts on “Yes, this is rich”

  1. Person in Pictland

    OK, he doesn’t understand deadweight costs. He doesn’t understand tax incidence either. Therefore he is sublimely unqualified to speak about tax.

  2. That’s a telling exchange though Tim

    For him – there is no cost to tax.

    He is on the record repeatedly as saying politics is about power. He wants it, and taxation is the ultimate expression of his vision of power.

    He has repeatedly suggested he wants to steal all resources not held by the state. ISAs, pensions even current accounts all need to mobilized for his vision of an all encompassing, ‘socially just’ state that is environmentally sustainable. To imply there is a cost to such a belief is therefore a direct challenge to his raison d’etre and his dream. Given his preternatural ability to start a fight in a phone booth is it any wonder he probably doesn’t consider the costs?

    Lest we forget we are talking about a source of pure evil almost without historical parallel. It’s baked into his DNA.

  3. None of these studies *PROVE* anything: the best any study can do is *disprove* rubbish such as that emanating from Murphy.
    Unlike him I have a qualification in Statistics so I do know what I am saying.
    BUT they can provide compelling evidence that tax rates that encourage guys to sit on the sofa watching football (or worse, daytime TV) instead of working are a BAD THING (“1066 and All That” was published before Daytime TV started but I am sure the authors will not object) .
    As to the “bebefits” of tax …
    Er … there must be some benefits Shirley, I mean shurely. It reduces inequality by making some people poorer.
    What *I* want is to make the poor people (especially the poorest) less poor.
    FYI as pay in the Public Sector is higher, on a like-for-like basis, than pay in the private sector it is debatable whether the current level of taxation *does, in reality* reduce inequality

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