Originally Posted by Starkipraggy
If you increase tax but increase subsidies to the lower and middle class to offset the tax, wouldn't that work out as well?
I was under the impression that people would be trying to save whatever they can, so instead of letting them save the little money it can get taxed so you can subsidise them.
The theory is, people are more likely to spend money that they keep as opposed to money that they get in a check from the government.
Your method is also just unnecessarily complicated and takes more paperwork, which takes more money.