Economics of Climate change (Book Review Sample)

Name: GSI’s name: The date: Word count: 1552 1 Statement of economic question The question discuss in the article is that can a broad-based credit-invoice value-added tax (VAT) be friendly, effective and consistence way of enhancing revenue collection to the government and result in sustainable growth? In accordance with (Cassidy 2005) findings highlighted that tax used to represent highly respected government whereby bigger share of the revenue is generated to the government without the public awareness. Through VAT the government can hide taxes on goods and services and enhance revenue collection that can facilitate progressive and sustainable growth (Finkelstein 2009). It is important to investigate in this issue because VAT raises a lot of revenue to the government thus resulting to excessive spending (Becker 2003), which may in turn hurt the economic growth for low income household and middle income household. Therefore looking in this method of taxing goods needs to be analyse so that government spending could be less and public debt is reduce so that the citizens do not feel the burden of borrowing. This would enable policymakers to enact initiatives that do not only would cut government spending but also address long term challenges that pertain to revenue collection for government. This paper was picked because it focuses on revenue collections that boost economic growth and has a lot of practical data that evidently shows how VAT contributes to economic growth as compared to the other which is addressing racial discrimination in economic perspective which is not easy to be addressed by economists. This paper also helps in solving the implication that arises with sale taxes which many nations are hinged. Researching on this paper would help in proper designing of sale taxes (McLure 2002). Looking into sale taxes can raise revenue with minimal economic distortion thus reducing administrative costs. 2 Positive Economic Analysis Most important points raised were VAT is widely known because of the following reasons; VAT generates a lot of revenue to the government. These revenues are important in enhancing social, economic and political growth as it provides variety of resources to the government. According to economist in United States VAT is the third revenue source after income tax and social security tax. Therefore this type of tax has a significant influence on the economic growth. In addition VAT is also use in conjunction with other highly progressive policies, like direct wealth tax, capital gains reforms, or other policy changes that raise taxes on well-to-do households (Gale 2019). Another important point on VAT is that they are dependent on prosperous economy. Goods and service bought by individual citizens are tax thus helping in revenue collection that is used to initiate various government projects thus enhancing livelihood in the society, thus reducing burden on both the rich and the low income household. Thirdly according to (Burman 2019) VAT boost necessary government investments and also help in cushioning the nation from the adverse effect of other challenges facing the sates. This can help in reducing the depression of the economy in short term run thus enhancing sustainable growth of the economy. Nevertheless, this type of tax is simple and easy to adjust by just increasing the amount of nominal prices of resources available in the state this adjustment can help realising the value of VATs thus revenue would be achieved. Lastly, it is important to consider that converting the existing retail sales taxes to conform to federal VAT base would greatly help in generating high level of revenue in a way that is quite progressive and can be distributed to entire state. It is effective and has more advantages than other types of taxes this imply that it does not hurt savings, investments and even financial management hence it is easy to enforce than any other taxes. These important considerations are based on combination of data and theory, concerning to data it is evident in the previous records of data that shows how VAT has generated revenue to various previous financial years and there subsequent investment, on the other hand it part of theory is based on perception of different economist on how they view (Gale 2019) VATS as a way of revenue collection. The key conclusion is that VATs has a lot of revenue for government and can help in realising high economic growth if such resources accruing from such taxes are properly utilize and directed to intended purpose like investments and even supporting the poor in the indigenous community this help in equal distribution of resources. This is only possible if the federal government allow the prices of goods and services to rise as a way of adjusting the VATs to increase revenue collection. Additionally, VATs should be used as a way of supplementing other forms of taxes like import taxes among other form of taxes. Main policy implication is that the policymakers have not appropriately enacted the VAT law (Schenk 2011). They have not seriously considered looking into details of these consumptive taxes on commodities and the benefits they have. The adjustment should be made to this VAT to low prices of various commodities to rise so that a lot of revenue would be generated to the government. Would like to see if the federal government can enact, implement price rise of goods and services sustainably so that more economic and social benefits associated with VAT tax can be realized and thus proper utilization of pool of resources generated from this kind of tax can result to vast investment and enhance household living standard of both the rich, middle income and low income individuals, this can eliminate negative perception of some economist (Becker 2003) that high taxes associated with VAT can lead to over spending resulting to public debt. 3 Statement of Relevant Economic Concepts The 2 relevant economic concepts were; the first concept is that unemployment rate is higher among the youths than any other groups of people. Unemployment is evident if among many qualified youths who have knowledge and skills but lack a place to practise their skills. This is contributed by poor state of the economy, market regulation and poor policies implemented by the government which do not favour employability. Many states in the world majority of its population (Gale 2019) are currently facing lack of jobs and the government has do very little to offer solution to this challenge. The second concept learnt is that most politicians and some government or states are taking advantage of the situation of the unemployment among the youths this is mostly witness in developing countries. The description of the first concept is that in most countries youths are the majority of the population than the elderly this also has contributed to unemployment. However in developing countries most of the youths lack employability that’s is relevant skills and knowledge required in the labour market (Beveridge 1944) this makes it difficult for them to secure jobs in the states. The second description of the concept is that politicians have failed to create slots needed by youths to offer them employment due to the fact that most politicians normal misuse the youths during elections periods by enticing with hand-outs and tokenism (Webb 191...