- Tax cuts can stimulate growth — the idea is that if people are left with after-tax income, then they can spend it on more/other goods. It can also increase rates of saving and investment which has a positive effect on the economy. - However, cutting taxes is often not as simple as it seems, because of how the cuts will differ depending on how high or low people's incomes are. There is [an argument] (https://www.investopedia.com/articles/07/tax_cuts.asp) for tax cuts being against the interest of those who are lower on the earning scale — because those who earn more benefit more from cuts (if there is a sales tax cut of 1%, someone buying an expensive product will see a higher reduction than someone buying a cheaper version). And because tax cuts reduce government revenue, the loss has to be made up by cutting spending — which can negatively affect those with lower income who rely on government resources. - Studies have also shown that [tax cuts aimed at lower earners are more likely to be productive] (https://www.lse.ac.uk/News/Latest-news-from-LSE/2020/L-December/Tax-cuts-for-the-rich) than those aimed at higher earners — because they'll be more likely to spend the extra money and feed it back into the economy. - So ultimately — tax cuts can stimulate growth. But generally, cuts that are aimed at lower-income consumers will be more likely to grow the economy. A lot depends on which sectors the cuts are made in.