Wednesday, June 17, 2009

I am sick of taxes

There you go. I could not be more explicit. There are different theories as to what extent taxation can be beneficial and beyond which point any additional taxes will be detrimental to the GDP growth rate.

America has long enjoyed unrestricted access to debt from various sovereigns (China and KSA). Supporting these copious amounts of capital inflows is the unlimited taxing power of the US Congress. However, a careful analysis of this assumption would reveal that high levels of taxation take away the motivation to work. Put differently, if you know that the government will take away all your earnings to repay the debt and that you will not be getting anything back, you would prefer staying home.

Now that every one in the economy has decided to stay home and do nothing, I wonder how sharply would the GDP fall.

Anyways. What pisses me off the most is the indifference of the feudalist/legislators/senators/MNA's/MPA's towards the working middle class. Agriculture, which makes up close to 25% of our economy remains out of the tax net. Did somebody mention "broadening of tax base"? Does that mean massacre of the corporate working class of Karachi?

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