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Author: warrl Big funky green star, 20000 posts Old School Fool Add to my Favorite Fools Ignore this person (you won't see their posts anymore) Number: of 740299  
Subject: Re: Optimal Tax Policy Date: 10/16/2012 10:47 PM
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In my mind, Optimal Tax Policy is what results in the largest overall amount of taxes going to the Government over the long term. That sounds counterintuitive, if not blasphemous, to tax hawks, but think about it. Lower rates increase tax revenue, but only to a point.

I half agree. The optimal tax policy has an overall tax structure matching what you describe, but with rates *no higher* than that.

However, if a lesser amount of tax revenue is sufficient to fund the necessary and proper function of government, that lesser amount of tax revenue should be achieved by setting tax rates *lower* than the point which maximizes long-term revenue.
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