Contrary to any claim of a systematically “neutral” effect of taxation on production, the consequence of any such shortening of roundabout methods of production is a lower output produced. The price that invariably must be paid for taxation, and for every increase in taxation, is a coercively lowered productivity that in turn reduces the standard of living in terms of valuable assets provided for future consumption. Every act of taxation necessarily exerts a push away from more highly capitalized, more productive production processes in the direction of a hand-to-mouth-existence.
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