Economists prefer tax rate smoothing because

Name: Economists prefer tax rate smoothing because
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Question

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Tax rate smoothing minimizes distortions by avoiding sudden and dramatic changes in tax rates, which can disrupt economic activity and create uncertainty for taxpayers. While it may not eliminate all distortions, it is considered a more optimal approach than sudden rate changes. It is not necessarily designed to benefit the poor or maximize government tax revenues.

Economists Prefer Tax Rate Smoothing Because