Friday, February 02, 2007

Political Rules #1 Sell on the perception, Buy on the reality

With any law or tax change this is how it always seems to be done. Take the introduction of the GST. In part it was sold on perceptions that it would reduce the black market incentives, reduce income tax burden, help exports etc. None of that really matches the reality. That doesn't mean it wasn't good for the country or for the government. The actuality of the benefits are more in line of - less paperwork, easier and more consistent tax revenue flow, less distortions on commerce. This is why the government "bought" the idea of a GST.

No comments: