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More people will have more money to spend on other goods that they normally wouldn't of been able to spend. This means that the producers of products like expensive jewelers, will have a higher profit and more demand for their products

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11y ago
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15y ago

In a word, disaster! In Britain it will result in 5 million unemployed and anarchy. Geoffrey Howe and Margaret Thatcher infamously tried slash and burn economics in Britain in the eighties to awful effect and it resulted in unemployment leaping from one million to three million almost overnight. Widespread civil unrest followed. Britain still suffers the legacy of the Thatcher years of underinvestment. Thatcher lifted restriction on what money could be invested abroad, so tax cuts resulted in money draining out of Britain. It was the start of globalisation, which is so spectacularly failing now. If another slash and burn government comes to power, things will get very bad indeed.

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14y ago

thy economy would get worse.

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Q: What will happen if government reduce spending and income tax?
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Related questions

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the macroeconomic objectives being pursued by the government will greatly influence government spending . a government aiming to reduce employment and promote economic growth is likely to pursue an expansionary fiscal policy , thus increasing government spending where as a government aiming to control inflation is likely to follow a contractions policy thus reducing its spending.

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Is it true the only way a government van raise large amounts of money is through some form of taxes?

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