[visiblink]

It does to me.

During World War II, the Canadian government raised taxes in a bid to reduce demand and curb inflation (along with wage and price controls, mandatory savings, and other measures).

Inversely, reducing taxes holds the potential to leave money in people's pockets, increase demand, and trigger inflation. Whether it does so will depend on a host of other factors, of course.

[imtringued]

Tax raises obviously increase the deadweight loss associated with that tax because at some point the cost exceeds the marginal utility of the product and people buy less until things are in balance again. But when there isn't enough product to go buy and the government pays off debt, then the deadweight loss may actually be reduced over the long term.