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This tax reform would be to encourage people to save or invest money and in return, they will not have to pay taxes on this income until they decide to spend the money. When people save or invest their income, revenue raises. When you save and invest, you are using aggregate expenditures.
Aggregate expenditures are planned expenditures...
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When you save and invest, you are using aggregate expenditures.
Aggregate expenditures are planned expenditures. They equal consumption plus investment plus government spending plus net exports, the same as GDP except that they are planned. When the government makes changes in taxes, such as the USA tax, it is planned in an effort to boost the economy or slow it down...
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FOREIGN TRADE POLICY AND THE IMPACT ON AGGREGATE EXPENDITURES AND EQUILIBRIUM
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