This is more of a statement of fact than an assertion of fact. Many people don’t realize that the only way that a tax can be the most effective is if it’s the most efficient. In other words, the more people that are paying the more efficient the tax will be.
The more efficient the tax is though, the less revenue it will generate. This is why it is such a tricky question for the IRS to figure out what is the most efficient tax. A tax that is very inefficient (one that is too high in both costs and revenues) can be effective at keeping taxes down, but will lead to more taxes since its being paid by fewer people.
Economists have a term for this type of tax which is called a “tax elasticity” tax. In essence, they say that a tax that is too high in either costs or revenues can be effective but if it is too high in both costs and revenues, then its less effective. That’s because the more people that are paying taxes, the more those taxes are “effective”.
The problem is that an efficient tax is one that is too high in both costs and revenues. Too high in costs and revenues means that the government is going to have to pay more in taxes and that means that its cost is going to increase. Too high in costs and revenues means that the government is going to have to give less in direct taxes and that means that its revenue is going to decrease.
An efficient tax is one that isn’t as high in costs and revenues as taxes that are not too high in both costs and revenues.
Taxes and other government spending are so onerous in the modern era that the government can’t afford to pay them unless it has to. Since government is so onerous, most people avoid doing anything about it. In fact, most people have a mental image of a government that is efficient and doesn’t waste money. This is simply a misperception. The reality is that most people think of government as being very efficient and paying a lot of money (taxes) to itself.
Tax and spending are two very different things. What economists call an efficient tax is a tax that is so onerous that it is just not worth doing. An efficient tax has a very low level of both costs and revenues. There is a huge difference. Taxes are taxes that are imposed by the government, and that the government has to pay. They are not taxes that the government is actually going to pay.
Economists call the process of setting taxes and spending more or less “revenue generation.” When the government sets taxes, it is going to collect the money it’s paying in taxes. When it spends the money it’s collecting, it is generally going to spend the money it’s collecting. Economists call this the “tax function” of a government.
It’s easy to see the efficiency of taxes. Think about it: If you wanted to send a message to someone, you could just buy a big, expensive, expensive-looking envelope that had an address written on it. You could also write on the envelope a message that says, “Dear Santa Claus, I’m sending you a box of toys for the children of the world. They’ll be coming to you at Christmas, and you can count on me to bring them.
