Why are we promised tax credits?

I do not understand the logic of tax credits in creating stimulus.

The general pattern is, spend a lot today, and get ten or fifteen percent back on your next tax return. For most of us that means four to sixteen months later, we’ll get that bit back on what we spent.

I submit that anyone on a tight budget cannot collect such a tax credit. Those who can afford to pay for the item today will reap the credit as a windfall. It might make the decision for someone whose finances were somewhat close, but those who actually need that credit to afford the spending, can’t borrow the money for free for a year and wait to get it back at tax time.

So today’s dumb question is manifold:

  • Are tax credits promised because the somewhat-wealthy can collect them?
  • Is this a way of getting the vote of someone with no overriding political opinion?
  • Does the credit cause the related expenditure, or would it have happened anyway?
  • Is it all about putting tax dollars into renovation, or recreational fees, as a form of stimulus?
  • Is this more acceptable than a general tax cut for the poor? Is it less or more progressive than it should be? (progressive in the sens of progressive tax rates, eh?)

Why are we promised tax credits?

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