These small gains of $16bn will come at considerable costs. The losses in tariff revenues alone will be more than twice the benefit, or $32bn. Developing countries rely on tariffs revenue for 20 per cent of all government revenue, and therefore development policy.
I must be misinterpretting this. Someone please set me straight.
(Actually, I do not think even the food part of it is 'people's food' - to a large part, more likely the local elites' and the local small middle classes' food.) *Lunatic*, n. One whose delusions are out of fashion.
As usual, the more you dig into these questions, the more complex things are, and the more difficult it gets to justify "simple" solutions. In the long run, we're all dead. John Maynard Keynes
but it is usually one of the easiest to "capture"
I think you nailed it right here, unless I didn't follow what you meant properly. Tax collection can be a very difficult thing in these countries. Ideally, you would want to lay the burden primarily on the wealthy (though you, of course, want to avoid choking the economy). But, chances are, the wealthy control the government and can find ways of getting around it, so that ideal cannot become reality.
I agree, completely, that tariffs are a bad thing to tax in these countries, especially if food falls under those tariffs. You're also write that the issue of "Okay, so how do we get revenue?" needs to be discussed more.
20% tariffs don't necessarily translate to 20% price increases. It depends on the good. In the case of food, with little competition from domestic producers, it probably would result in roughly a 20% increase in price, since everyone has got to eat and the demand is inelastic. Conservatives want live babies so they can raise them to be dead soldiers. - George Carlin
