Instead, we see a very different narrative: people cope with high inequality by convincing themselves it is fair after all. High earners have most to gain from income tax cuts, and more spare cash to lobby politicians for these cuts. For income tax cuts to raise tax revenue, the prospect of higher after-tax pay must motivate people to work more. But the Laffer curve did remind economists that a revenue-maximising top tax rate somewhere between 0% and 100% must exist. Modern economics provides neither theory nor evidence proving the merit of these tax cuts.

Source: The Guardian June 06, 2019 04:52 UTC