Vendors now cannot get X pounds with Y pounds advertising outlay to make Z pounds per unit of wares. To continue making Z money per unit of wares, with previous S pounds price charged to consumers per unit, add significantly more than reduction in Y advertising per unit to S to offset reduced "brand" "awareness".
replyBrand awareness is a Red Queen’s race. Attention is a finite resource, and ad spend mainly exists to counteract the spend of your competitors.
replyNo one buying shit anymore. People still buying shit elsewhere. GDP and tax revenues fall relative to others. Deflationary aspects. Market leaders complain through lobbying groups. Repeal. Back to square one.
replyThat’s just a restatement of your previous point. Pretend I restated my response.
replyI don't agree. They are two separate depictions of what might happen as a result of applying a tax on advertising. They may well coincide with each other, however. Saying that the second is a restatement of the first is like saying two interpretations of Piero Manzoni's "Artist's Shit" are restating the same fact.
replyGovernments see reduction in tax income and GDP and repeal taxes. In UK: Signal "mansion" tax on properties valued above X price to collect recurring Y pounds total tax. Market adjusts valuations based on probability of tax. Number of houses still worth at least X now diminishes. Now cannot collect recurring Y pounds. "Mansion" tax delayed.
replyYou have this complex system that has reached some sort of relative equilibrium based on say a set S of ten sorts of tax rates, along with a set F of factors (size millions), with the government's tax revenue R being one of those outputs. Then some guy in the government called G signals to the government and public that he can increase R by X by fiddling with a member of S, or maybe adding a member to S (of size say ten).
Is G stupid, or does he just lean towards retaining the public's affection, his relatively low salary, potential under the table payments and whatever networking opportunities his job provides? I lean towards the latter.