Concerning tax rates and growth, which of the following is true?
A) Tax rates do not influence economic growth.
B) Countries with high marginal tax rates have generally had higher rates of economic growth than those with low tax rates.
C) Countries with low marginal tax rates have generally had higher rates of economic growth than those with high tax rates.
D) Countries that impose high marginal tax rates at low-income thresholds generally have high rates of economic growth.

Question

Quizplus · Accepted Answer

Empirical evidence suggests that countries with lower marginal tax rates tend to have higher rates of economic growth. This is because lower tax rates incentivize individuals and businesses to invest, work, and innovate more, which leads to higher productivity and economic growth. Higher taxes can lead to decreased incentives for these activities. However, it is important to note that the relationship between tax rates and economic growth is complex and can vary depending on various factors.

Concerning Tax Rates and Growth, Which of the Following Is