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  • Should The Tax Laws Be Reformed To Encourage Saving ?

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    Tripti Rai
    615 просмотров13 страниц
    This document argues against reforming tax laws to encourage saving by increasing the government's budget deficit. It states that a higher budget deficit would shift the tax burden to future generations through deficit financing methods like printing currency and government borrowings, which can reduce purchasing power, cause inflation, and increase interest rates. Instead, the document suggests lowering the budget deficit to inspire more public confidence and private savings/investment, citing data that shows lower deficits correspond with lower inflation and higher savings rates.

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    Should the Tax Laws be reformed to Encourage Saving ?

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    Should the Tax Laws be reformed to Encourage Saving ?

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    This document argues against reforming tax laws to encourage saving by increasing the government's budget deficit. It states that a higher budget deficit would shift the tax burden to future generations through deficit financing methods like printing currency and government borrowings, which can reduce purchasing power, cause inflation, and increase interest rates. Instead, the document suggests lowering the budget deficit to inspire more public confidence and private savings/investment, citing data that shows lower deficits correspond with lower inflation and higher savings rates.

    Авторское право:

    Attribution Non-Commercial (BY-NC)
    Скачайте в формате PPTX, PDF, TXT или читайте онлайн в Scribd
    Отметить как неприемлемый контент
    615 просмотров13 страниц

    Should The Tax Laws Be Reformed To Encourage Saving ?

    Загружено:

    Tripti Rai
    This document argues against reforming tax laws to encourage saving by increasing the government's budget deficit. It states that a higher budget deficit would shift the tax burden to future generations through deficit financing methods like printing currency and government borrowings, which can reduce purchasing power, cause inflation, and increase interest rates. Instead, the document suggests lowering the budget deficit to inspire more public confidence and private savings/investment, citing data that shows lower deficits correspond with lower inflation and higher savings rates.

    Авторское право:

    Attribution Non-Commercial (BY-NC)
    Скачайте в формате PPTX, PDF, TXT или читайте онлайн в Scribd
    Отметить как неприемлемый контент
    из 13

    TOPIC

    Should the Tax Laws be reformed to Encourage Saving ? (AGAINST)

    GROUP MEMBERS 1)Tripti Rai 115 2)Rachit Johari 52 3)Ashutosh shrivastav 112

    There are other ways to increase savings instead of relaxation in taxes.

    Lower Budget Deficit !

    BUDGET DEFICIT ? ?
    The amount by which a government spending exceeds its income over a particular period of time is Budget Deficit.

    REASON WHY TAX REFORMS SHOULD NOT BE DONE


    If taxes are reduced then governments budget deficit will increase. This means revenue collected by the government will be less and expenditure of the Gov. is high then the budget deficit will increase.

    CONT
    Larger budget deficit will shift the tax burden to the future generations.

    If there is high budget deficit this means the government is taking loans (Deficit financing).

    DEFICIT FINANCING

    PRINTING OF ADDITIONAL CURRENCY

    GOVRNMENT BORROWINGS

    PRINTING OF ADDITIONAL CURRENCY

    Reduces the buying power. Causes inflation.

    GOVRNMENT BORROWINGS

    Will drive up interest rates. Credit will be expensive.

    BENEFITS OF LOWER BUDGET DEFICIT


    Reducing budget deficit will give public the confidence that the Gov. will be borrowing less in the future there by lowering the rate throughout the economy.

    Which implies that taxes impositions will be less on people.


    Which will increase the savings and investments of people.

    EVIDENCE
    40

    35
    30 25 20 15 10 5 0 SAVINGS INFLATION FISCAL DEFICIT

    DATA
    YEAR 2006-07 2008-09 2009-10 SAVINGS INFLATION DEFICIT 34.6 32 33.8 6.53 9.7 14.97 3.3 6 6.5

    2010-11
    2011-12

    32.8

    9.47
    6.49

    4.8
    4.6

    IMPLICATIONS

    Lower budget deficit helps in: 1) Lowering inflation . 2) Higher savings .

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