I reached the top of the curve. I've worked 12hr days for years. 6mos ago I told my employer I can no longer work so much overtime. I can't afford the taxes. you see, They don't see how hard I work to make the money I do, they just see the money and want more. proven point, High taxes Disincentives to work hard. TRUE I'm living it right now.
So what the governent should do is: 1. Appy the laffer curve to their taxation system 2. Close loopholes so that even if tax rates are low, taxes aren't going to be avoided but actually paid (especially by the rich). 3. Use the taxes conciously and for tye benefit of the society and the ones in need so that the population is satisfied and willing to continue paying taxes to the government.
Hi Mr.Dal.Thank you for sharing this content. I just need to know whether this content is still relevant for students who will be appearing in their A-level exams?
John Simons you could use the same argument yes. If a country increases it’s VAT rates too highly, then it will put people off spending money in that said country because it’s too expensive. If VAT is too low, then there will be hardly any revenue coming into the government from purchases made within the country. It’s all about hitting that sweet spot but the argument comes where that sweet spot is on the curve.
It's a theory, Laffer Bullshit, more Reaganomics shit, under Reagan who implemented this discredited theory (Laffer being one of his economic advisors) dropping taxes from 70% to 28% Reagan doubled the deficit and tripled the national USA debt to over $2 trillion, the next adminstration promptly put the taxes up again. Do some research and don't take everything you hear as fact.
@@ThePaperCreater president Reagan was an extreme example - taxing over 50% on 80,000 pound incomes which is what Corbyn wants (which isn't even that high of an income considering most of the inequalities arise from wealth, not income) only limits social mobility, makes it harder for people without wealth to accumulate wealth, and reinforces the divide. Fair enough if it was over 50% on income or wealth over a much larger income, but Corbyn is way too extreme. Professions that earn over £80000 - headmasters of state schools, doctors, lawyers, actuaries - aka people that we need. Why would anyone go through the effort only to have half of their income taken away. disgusting
@@MissVickixoxo I used President Reagan as my example, not because he was "extreme" but because he employed the very economic director who devised this theory for part of his economic plan. I'm hardly trying to find the worst possible example for this theory when I use the one which was employed by the very man himself. Furthermore, Corbyn wants a 45% income tax on those over 80,000, not 50%. A rate which you stipulate to be quite high but in actuality is historically quite low, with income taxes being as high as 81% in the UK, and even at 60% during Thatcher's tenure with the exception of the last two years. It should also be noted that roughly only 5% of the population is earning over £80,000, which includes those who are earning only marginally higher so the figure is likely to be inflated in real terms. You mention some professions such as doctors and headteachers of state schools earning over £80,000. However a quick google search would show you that state schooled headteachers earn only £60,000 on average. While there examples of state headteachers earning over £80,000, they are certainly not the norm. You also mention doctors, who ironically on average earn just over £80,000 in the UK. Therefore the 45% tax would barely impact their incomes. I will however agree, that certain medical professions do earn on average, £100,000 and would therefore pay more into the tax, however with an increase in taxation and a Corbyn government you would likely see more investment into the NHS and higher wages for all public sector professions, leading to higher consumption and therefore economic growth. SOURCE: www.telegraph.co.uk/news/health/9300823/Most-doctors-are-not-paid-six-figure-sums-figures-show.html You should also compare Corbyn's tax rate to other developed countries around the world, with Denmark and Sweden having much higher tax rates of 60% and 56% respectively, yet neither of these countries experience "brain-drain" or this Laffer Curve effect. SOURCE: tradingeconomics.com/sweden/personal-income-tax-rate tradingeconomics.com/denmark/personal-income-tax-rate
Jay Fawkes Kross we’re trying to learn economics, it’s a model. Have you heard George boxes quote “all models are wrong,some are useful”. It’s all about understanding the concept.
It is a MODEL. Models are like maps: they describe a terrain, but they are NOT identical to the terrain, they just give you a basic idea of how the terrain looks like.
@Jay Fawkes Kross that imaginary number will be found out when the taxes start to fall hence measures will be taken to bring it back to the maximum point.
THE MOST PLEASANT ECON TEACHER I HAVE EVER SEEN
absolute legend hadn't learnt the Laffer curve or the benefits of international trade diagrams, both so easy hopefully it will help in exam tomorrow
am at the same point as you ! honestly EconplusDal is the king
that smooth curve got me excited ;)
Thank you so much for a brief, but very clear explanation of the Laffer curve.
you honestly explained it perfectly, never understood something this easy. THANK U!!!!
I reached the top of the curve. I've worked 12hr days for years. 6mos ago I told my employer I can no longer work so much overtime. I can't afford the taxes. you see, They don't see how hard I work to make the money I do, they just see the money and want more. proven point, High taxes Disincentives to work hard. TRUE I'm living it right now.
Must be hard being the trash man
just amazing how you explanied it so easily
Easy explanation: I'm using your videos to study for the FSOT economics section!
this was just on point!!!!!
thankyou so much sir for making this topic easy,actually every video is easy when explained by you.
hahaha did ur khangress really understood the same? dis is what current govt did in corporate taxes to attract FDIs
Excellent explanation, Sir👋👋
I love you. Dad.
This so helpful!!! thank you for all the ECON videos
LIFE saver, thank you so much, may god bless you
Awesome explanation ...ty sir 👌🏻👌🏻😊
vikkstar if the sidemen never existed
Bants
Honestly, it was amazing👏🏻
Excellent! Thanks
Cheers dal
could you make a video on kuznets curve?
This guys gona be the reason I go Lse
did u get in?
thank u uncle
it was amazing👏🏻 thank you sir
I love his accent.
could you say the government setting the wrong tax rate could be due to them having imperfect information hence leading to a too high tax rate
Thank you
Very clear to understand
thank you so much, your videos are really helpful
Best Explainer........
what a legend
could this be applied to import taxes in any way?
Well explained thanks
Thank you thank you thank youuuu
GOAT 🐐
In my country they already passed the maximum taxable rate
Thank you so much
amazing
thank you so much. it helps me so much. now i get it 😆👍
Thankyou so much
So what the governent should do is:
1. Appy the laffer curve to their taxation system
2. Close loopholes so that even if tax rates are low, taxes aren't going to be avoided but actually paid (especially by the rich).
3. Use the taxes conciously and for tye benefit of the society and the ones in need so that the population is satisfied and willing to continue paying taxes to the government.
the government should cease to exist.
That curve was so beautiful though!
where is the uk on the gaffer curve ?
The peak for tax revenue is normally seen as around 50-55%, I believe the UK right now is at roughly 45% but this is just from what I remember :)
cheers man :)
Hi Mr.Dal.Thank you for sharing this content. I just need to know whether this content is still relevant for students who will be appearing in their A-level exams?
what a sexy diagram
can it be used for indirect taxes like VAT too?
John Simons you could use the same argument yes. If a country increases it’s VAT rates too highly, then it will put people off spending money in that said country because it’s too expensive. If VAT is too low, then there will be hardly any revenue coming into the government from purchases made within the country. It’s all about hitting that sweet spot but the argument comes where that sweet spot is on the curve.
Ahh lovely
Great video. I've learned the Laffer curve is nothing to laugh about!
Can this be used in Micro?
Yep, is part of labour market
@@theredarrow0138 Cheers
can i use this for microeconomics for example progressive taxation
yes. this works for all tax markets. The only difference is where the curve is skewed. Is it towards the high tax rates or the low ones.
Please send this to Jeremy Corbyn
It's a theory, Laffer Bullshit, more Reaganomics shit, under Reagan who implemented this discredited theory (Laffer being one of his economic advisors) dropping taxes from 70% to 28% Reagan doubled the deficit and tripled the national USA debt to over $2 trillion, the next adminstration promptly put the taxes up again. Do some research and don't take everything you hear as fact.
@@ThePaperCreater president Reagan was an extreme example - taxing over 50% on 80,000 pound incomes which is what Corbyn wants (which isn't even that high of an income considering most of the inequalities arise from wealth, not income) only limits social mobility, makes it harder for people without wealth to accumulate wealth, and reinforces the divide. Fair enough if it was over 50% on income or wealth over a much larger income, but Corbyn is way too extreme.
Professions that earn over £80000 - headmasters of state schools, doctors, lawyers, actuaries - aka people that we need. Why would anyone go through the effort only to have half of their income taken away. disgusting
@@MissVickixoxo I used President Reagan as my example, not because he was "extreme" but because he employed the very economic director who devised this theory for part of his economic plan. I'm hardly trying to find the worst possible example for this theory when I use the one which was employed by the very man himself.
Furthermore, Corbyn wants a 45% income tax on those over 80,000, not 50%. A rate which you stipulate to be quite high but in actuality is historically quite low, with income taxes being as high as 81% in the UK, and even at 60% during Thatcher's tenure with the exception of the last two years. It should also be noted that roughly only 5% of the population is earning over £80,000, which includes those who are earning only marginally higher so the figure is likely to be inflated in real terms. You mention some professions such as doctors and headteachers of state schools earning over £80,000. However a quick google search would show you that state schooled headteachers earn only £60,000 on average. While there examples of state headteachers earning over £80,000, they are certainly not the norm. You also mention doctors, who ironically on average earn just over £80,000 in the UK. Therefore the 45% tax would barely impact their incomes. I will however agree, that certain medical professions do earn on average, £100,000 and would therefore pay more into the tax, however with an increase in taxation and a Corbyn government you would likely see more investment into the NHS and higher wages for all public sector professions, leading to higher consumption and therefore economic growth.
SOURCE:
www.telegraph.co.uk/news/health/9300823/Most-doctors-are-not-paid-six-figure-sums-figures-show.html
You should also compare Corbyn's tax rate to other developed countries around the world, with Denmark and Sweden having much higher tax rates of 60% and 56% respectively, yet neither of these countries experience "brain-drain" or this Laffer Curve effect.
SOURCE:
tradingeconomics.com/sweden/personal-income-tax-rate
tradingeconomics.com/denmark/personal-income-tax-rate
Joe Biden needs to watch this video
Someone should send this to the Labour headquaters
Vikkstar123
..
So stay out if California. Unless you wanna see what the right side looks like IRL.
Wow. This is all based on an assumption that you are above an imaginary number that no one knows or understands! Hahaha.
Jay Fawkes Kross we’re trying to learn economics, it’s a model. Have you heard George boxes quote “all models are wrong,some are useful”. It’s all about understanding the concept.
@@jack.1. So they should not be using it as evidence.
@@jayfawkeskross2418 I agree. Unfortunately it's very hard to know where the point is so we just have to ry and push and pull around it.
It is a MODEL. Models are like maps: they describe a terrain, but they are NOT identical to the terrain, they just give you a basic idea of how the terrain looks like.
@Jay Fawkes Kross that imaginary number will be found out when the taxes start to fall hence measures will be taken to bring it back to the maximum point.
thank you