Quote:
Originally Posted by Amadeus
It would be great to have an application that allowed you to specify a tax rate, threashold and it would show you how much tax was generated. I have wondered where it would have to be to allow for one tax rate and generate the same amount of money for the government coffers
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If only life was that simple. Changing taxation in any significant way affects an enormous number of economic variables.
There is a group sponsored by Ernst and Young called the ITEM Club (Independent Treasury Economic Model) which runs the same economic model as used by the government. But even with 40 economists and a stack of computer power they can only run a range of scenarios and give you some likely outcomes. Predicting things like consumer sentiment when faced with tax changes is notoriously difficult.