Are Tax Cuts Beneficial For Improving Economy - 1544 Words

Are Tax Cuts Beneficial for improving an Economy especially after a Recession? Argue and Defend Your Point. Recessions in any country can present the most difficult economic challenges to the authorities as they seek the best methods to regain their economic power. There are different avenues they can attempt to alleviate the issue including the reduction of government spending and tax cuts for the citizens and businesses . The concern for this investigation is the ability of tax cuts to increase the economic stimulus in that period. The review will focus on how the strategy can benefit the citizens and enable the country to restore itself from the financial difficulties over that time. There are different outcomes the country should†¦show more content†¦The recovery of the taxes to the nation’s budget may take time, but it helps them maneuver out of the economic recession. The first benefit that a tax cut will bring is the encouragement of efficiency in the private businesses . It provides an opportunity for investors to inject money into the economy since it has the potential for growth, and they do not incur as many costs for running the investments. The tax cuts also reduce the amount of risk that the companies will have to indulge in to enable them to make a profit. With a high cost of transactions due to the taxes, the corporations will have to spend more on acquiring and paying credits and that increase the amount of risk for their operations. That move will spur their investment ventures and promises quicker growth than other avenues of alleviating the recession. The move also reduces the possibility for the larger organizations to indulge in acquisitions and mergers with the smaller business that may eventually lead to monopolies. It is hard to control most market factors in an environment whose operations have a saturation of monopolistic part icipants; therefore, it is not economically healthy. A reduction in the taxes will encourage all forms of business participation. The cut will provide an excellent opportunity for the small enterprises to withstand the difficulties of the recession. That will prevent the possibility of the larger corporations turning into oligopolies and eventually monopolies that areShow MoreRelatedBarack Obama s Current Tax Code1728 Words   |  7 Pagesup, different tax policies are being debated between the candidates. Whether it is proposed by a Democratic or a Republican presidential candidate, there have been many possible solutions presented on how to reform the current tax code. Focusing specifically on four candidates, two from the Democratic Party, and two from the Republican Party, I will compare and contrast their respective tax proposals. While the Democratic candidates generally agree with President Obama’s current tax code, all fourRead MorePestle Analysis Essay1557 Words   |  7 Pagesinternal environment of a business (Panah, 2012). Government policy, economic growth, social trends, new technologies, new laws and climate change are all examples of macro change. Political factors include tax policy, trade restrictions and tariffs. It’s what the government intends to change in the economy. Economic factors include interest rates, inflation rates and exchange rates. These factors influence a business’s day to day operations and decisions. Demand is affected by social trends such as ageRead MoreEconomic Integration And The European Union1583 Words   |  7 PagesThe Greek inefficient tax collection, and its unemployment was â€Å"worse than unemployment in the United States during the Great Depression,† which made it very difficult to cut spending (O’Brien). Prior to joining the EU, Greece already experienced inflation and fiscal deficits (Johnston). Although the acceptance of Greece into the Union was conditional, at the ti me, Greece did not meet the guidelines of the Maastricht treaty. Greece hoped that the EU would help boost the economy. When Greece acceptedRead MoreThe Presidential Election : Barack Obama1465 Words   |  6 PagesTrump with his pick for Vice President, former governor of Indiana, Mike Pence. Whichever candidate wins the presidency will take on the task of trying to alleviate many of the issues our country faces today. One of those issues is to strengthen our economy and create new jobs within the United States. Hillary Clinton’s plan involves making college debt-free for students, making corporations pay their share of taxes, fixing America’s infrastructure and creating new manufacturing jobs in the United StatesRead MoreThe Financial Crisis Of The United Kingdom And The World1341 Words   |  6 Pageshad gone bankrupt or made a lot of losses it managed to make profits though 55% less than the previous year. Throughout these years it has been improving its performa nce making it the second largest mortgage and savings provider in the UK. BODY UK economy has a heavy dependence on the finance sector and therefore the initial recession hit the economy hard. Following the financial crisis a wide range of measures have been taken by the government of UK and the bank of England. The fiscal stimulusRead MoreEconomic Growth Is A Macroeconomic Policy Objective For Countries1467 Words   |  6 PagesDEFINITION Economic growth is a macroeconomic policy objective for countries. The growth of economies have two meanings. First, economic growth means the gross domestic product (GDP) increases within the given period of time.The increases in GDP also means the increase in the value of national output or national expenditure.The other meaning is the increasing of production when using all the scarce resources,which can be showed in the PPF(Production Possibility Frontier).In the diagram below,theRead MoreAmerica Has Made Mistakes Before1678 Words   |  7 Pagesplans out their economy’s future a little more. One of the top five largest economies in the world, the United States, promises for new laws regulating and decreasing in tax burdens in United States’ markets. Americans can expect to see a faster growth than previous years, and according to Forbes article The U.S. Economy In 2017: Welcome Higher Growth, â€Å"the U.S. economy will be a key driving force of other Western eco nomies† (Chafuen 1). Especially now with the new president, Trump, he has alreadyRead MoreThe Great Recession Lasted From December Of 2007 Until1229 Words   |  5 Pagespreviously mentioned metrics are used to compare today’s economy to the economy during the Great Recession to see how the United States has rebounded since 2009. Monetary and fiscal policies were also implemented to combat the recession, and their effects determine whether or not the policies have a lasting effect in continuing to help the U.S. economy rebound. Metrics Then and Now The most commonly-used metrics to evaluate the growth of the economy are: GDP, inflation, unemployment, and interest ratesRead MoreJobs and Economic Growth1788 Words   |  7 Pagescurtail environmental laws. In addition, Romney plans to open new markets by pursuing free trade agreements and by taking a confrontational tone with China. His plan includes cutting taxes on business and on individuals and maintaining the Bush tax cuts. He wants to eliminate federal retraining programs and delegate them to the states and to make changes to the immigration system to attract certain categories of well-educated workers. He also seeks to reduce the size of the US budget. His plansRead MoreKeynesian Economics For American Fiscal Policy2241 Words   |  9 Pages Pragmatism reactionarily stems from the excesses of its past. The realization in United States politics that increasing government tax rates would not solve the economic malaise of high unemployment and rising inflation occurred in the late 1970s. Thus began a movement in the minority of economic thought suggesting the existence of a prudent alternative to the widely accepted theory of Keynesian economics for American fiscal policy. Though subtle at first, these ideas of supply-side economics gained