Maya Forstater

Today, the "taxes matter" message is often used by those who want to shift the burden from capital to labor or to reduce the size of government. If you don't like this agenda, there are two ways of dealing with this.

1) Insist that behavioral effects are just one side of the trade-off, the other being fairness, public goods etc. 2) Reject the existing evidence and only account for studies that show weak response to tax.

A good example for 1) is the paper by @gabriel_zucman and Saez on wealth taxes which explicitly assumed a substantial response to a 2 percent wealth tax (15 percent evasion/avoidance). http://gabriel-zucman.eu/files/saez-zucman-wealthtaxobjections.pdf …

I intepreted your tweet, Alex, as an example of 2) - sorry if I misread it. By denying or ignoring the existing evidence, one might lose those who - like me - share the goal of fair taxation, but believe the evidence.

1) we share the same goal b) @alexcobham reigned back on its original statement, moving from "unimportant" to "tax is secondary to a range of real economic factors". I am happy that his first comment is probably hard to justify, but I am a lot more confident re: the second one

The WB data shows that a number of factors are important for investment in dev countries (may get very different results for developed countries). Low Tax rate is one factor, but the narrative that I/you would like to change is that this is the key factor to attract investment

Here's another of those unstated assumptions though: that additional, tax-motivated FDI will have any offsetting benefits for people in the host country. Evidence shaky to say the least