Through that it tries to solve its

Through an increase in the direct taxes charged on the
commodities, the overall government revenue can increase significantly. This is
because the government is the only body that is charged with the mandate of
collecting taxes from the several sectors of the economy in order to boost its
expenditure. In majority of the economies, it is clear that the income they get
is normally short of the total expenditure (Mitchell, 2008). This normally
leads to a budget deficit which makes the economy not to be doing so well.
Budget deficit suppresses the government so much such that it has to find
alternative means so that it can perform its national mandate to its citizens.
This is to mean that it has to see ways through which it will be responsible
enough in meeting the expectations of its citizens which is its chief role. There are so many ways through which the government
can sort out the budget deficit including borrowing from both internal and
external organizations including lending institutions, (Gillitzer Kleven&
Slemrod,2017). Borrowing from any lender by the government has a
consequence of increasing the debt capacity of a nation and this is normally
discouraged by most of the states. This is to mean that the government has to
look for alternative solutions to see to it that it tries to solve its internal
problems from the internal capacities to reduce the burden of debt .This is
good for making the state decisions without any foreign burden that could be a
big bother to the state in general. The government controls most of the
macroeconomic and microeconomic variables including taxation, interest rate,
inflation, exchange rates among others. This puts it in a center of control
since it can do what it can to see to it that it heals its economic wounds. This is because these economic variables always
dictate the cause of action as far as the state economic plans are concerned,
(Gillitzer Kleven& Slemrod,2017). As
far as the case at hand is concerned, the government wants to raise the taxes
for UK so that it can raise revenue which can be used to offset the deficit
balance in the long run. To some extent, this can be an advantage to the
government because it will eventually raise this needed amount from the taxes
it will collect fro, the people. This is because the taxes will be direct and
no one in the tax bracket will be able to evade the tax, (Mitchell, 2008). This
means that the target of raising this revenue would be made a success by the
increase in price of the taxed commodity. The offsetting of the deficit balance
is likely to return the economy of the nation to its original state since it
will make it to have limited financial challenges because of the relief or the
burden that will have been done away with. However, this needs to be done with
caution because the gathered finances can channel a temptation of being
channeled to other uses. This requires better budgeting that is supposed to
ensure and see to meet that there is some equilibrium in the balance of
payments. Should a case come where there is still a deficit, some other state
alternatives should be sought to make the state to achieve its goals. This should
be done in conjunction with the budgetary procedures in the country (Mitchell,
2008). According to the issue at hand, the politician under discussion argues
that the government should place an increase in tax for all the food products
because people must eat. This is to mean that the people of the said state will
have to buy the food products at a slightly higher price than the one that they
used to buy with initially. Again, it also implies that the consumption
patterns of the individuals will have to vary at a reducing ratio. This is
because not all the individuals have the same purchasing capacity .The low
income earners are likely to be severely affected by this state rule hence
barring the quantity purchased in the long run. The
amount that will be available in the market is also likely to reduce since even
the sellers would be affected by the tax regime (Gillitzer Kleven&
Slemrod,2017). This is because they have a likelihood of having
limited number of consumers because of the unanticipated price rise that would
have faced them. The suggestion that tax regime should only be applicable to
the sellers of groceries as given by the politician has a number of advantages
and disadvantages. As the politician argues, this is aimed at protecting the
low income earners. This could be fair to the low income earners who would be
adversely affected if the prices of the grocers are hiked to accommodate the
tax issue. This is because the increase in price would mean that they will be
buying the same commodity at a higher price than they used to but initially
with the same amount of fixed income. This is likely to reduce their purchasing
power as well as making the value of their money to be low .This is because
they are spending more on less income which is uneconomically viable. The high
income earners, on the other hand, are affected by the price rise of the
commodities to accommodate tax rise. This is because they will have to shift
their budgets so that they buy the products. The sellers too have to feel the burden
of buying the same commodity at high price. This is because they are not
certain whether the small income earners will be in a position to afford the
products. According to me, I agree with the politician on the need to reduce
budget deficit. This is because budget deficit makes the state to
be in a position where it can’t perform its obligations effectively due to
financial limitations (Fairfield& Garay,2017). Therefore
it needs to do its best to see to it that the budget is able to sort out its
responsibilities. This calls to measures to increase its revenue and do its
best to see to it that its expenditure is reduced. The government can also
raise taxes on other essential goods like the transport and communication
service. This hike in tax is likely to affect all the citizens hence promoting
equity which is a principle requirement of any tax system. This is because all
the people will feel the same impact and incidence hence placing equal burden
to all the citizens .The government increase in tax in these two sectors is
likely to fetch good revenue for the state because it is they are essential
services for all the citizens .They are very instrumental for the existence of
all the citizens since they can hardly live without them. References
Mitchell, D. (2008). A note on rising food prices (Vol. 4682). Washington, DC:
World Bank. Fairfield, T., & Garay, C. (2017). Redistribution under the
right in Latin America: electoral competition and organized actors in
policymaking. Comparative Political Studies , 0010414017695331. Gillitzer, C.,
Kleven, H. J., & Slemrod, J. (2017). A Characteristics Approach to Optimal
Taxation: Line Drawing and Tax ? Driven Product
Innovation. The Scandinavian Journal of Economics , 119 (2), 240-267.