Many economists believe that tax cuts increase incentives to work and invest but current U.S. tax levels do not appear to be on the downward side of the Laffer curve.

Question

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The Laffer curve suggests that at a certain point, increasing taxes can actually decrease revenue as people have less incentive to work and invest. However, current U.S. tax levels do not appear to be on the downward side of this curve, meaning that tax cuts could potentially increase incentives to work and invest.

Many Economists Believe That Tax Cuts Increase Incentives to Work