As The Bahamas considers implementing yet another tax (VAT) and more and more regulations (standards bureau etc) it seems appropriate that they consider the damage done to economies all over the world with policies like these before jumping in head first.

The Economist Magazine recently offered up some interesting food for thought that I'm thinking about printing and mailing to every Member and Parliament, Senator and political party leaders in the hope they will take the time to read it. You can read "Plucking the goose" (paywall) here… This is a summary of their special report on this subject, noted below.

Here's a couple salient points:

• High tax rates and and regulations have governments and business at each others throats.
• When most economies are struggling, particularly ours, why aren't our politicians relaxing taxes and regulations to get new business going?
• "High tax rates and complex regulations create an arms race in which companies lobby politicians for the best deals and the most successful businesses may not be the ones with the best products but the ones with the best political connections."
• "The solutions have been rehearsed often by this newspaper: lower tax rates and far fewer exemptions; a tax system that focuses on individuals not companies; regulations with sunset clauses so they expire. But it also requires a change of attitude, especially on behalf of the politicians."
• When taxes and regulations seem out of control, the economy shrinks so it does not seem like rocket science that we should do the opposite.
• Tax revenue can be higher with lower rates.

There's a great eight minute video in The Economists recent "special report", A world of robber barons. Better still, you can read it all here…

Hat tip to S3S for sending the link to the articles along.