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Lesson from Europe More Taxes Means Less Growth

Created on October 24, 2013

Lesson from Europe More Taxes Means Less Growth

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READ the original report, "Look Closer: Tax Increases, Not Spending Cuts, Are the Harmful Austerity."

Eurozone countries that increased taxes had less economic growth. Many of the same countries cut government spending, but the relationship is weaker and less clear. Figures are changes from 2009 to 2012

Keywords: Slovakia, Germany, Greece, austerity, government, spending cuts, taxes, GDP, growth

Notes: Tax changes are illustrated as percentage of GDP. Expenditure cuts are portrayed as percentage of potential GDP and exclude interest payments. Source: International Monetary Fund, Fiscal Monitor, http://www.imf.org.