Question

A. Improving the tax revenue generation power so that the Government could

have more revenues to spend and meet the additional demand on public

spending, or / and

B. Reducing the burden of individuals and / or corporations in those countries

to pay tax to the government, and improve their wealth beings (more

retained profits or after tax free spending incomes) which leads to a better

probability of survival and sustainability of the respective corporations

and individuals.

How to do part (A) and part (B) at the same time?

Answer 1

Answer: these two could be done at the same time through “tax cut”.

This is the reduction of tax rates, which gives incentives for working, making profit, etc. It reduces the burden of tax liability and promotes more consumption and investments. Since consumption and investment are the components of GDP, this actually increases GDP of the country. Once there is more GDP, there would be more outputs and more incomes – these lead to more collection of commodity tax and income tax by the government. Therefore, it increases revenues of the government, which may be spent.