Question

Develop a list of tax benefits to promote socially desirable actions. What are implications for taxpayers, the economy, or society?

Answer 1

There are many reasons why tax incentives can be a particularly good way to encourage the development of healthy communities, but they really boil down to one: they offer what for many people is the most desirable reward for desirable behavior.

• Tax incentives speak to businesses’ and individuals’ self-interest. Virtually all businesses and most individuals respond readily to offers that advance their own interests, and most particularly to offers of money. Our whole social structure is based on this assumption: how many of us would work if we weren’t paid? Some form of payment, therefore, is usually the most effective way to convince businesses and individuals to do something they are unsure about or might otherwise be reluctant to do.
• Tax incentives make allies rather than adversaries. They’re the policy equivalent of the old proverb “You can catch more flies with honey than you can with vinegar.” By using tax incentives rather than (or along with) regulation to achieve your goals, you make the businesses or individuals receiving the incentives your partners. It’s much easier, for instance, to work with a developer who wants to make sure that his project meets environmental standards so that he can get a significant amount of his investment back than with one who considers environmental regulations an unnecessary barrier, and looks for ways to get around them.
• Tax incentives can show businesses that community-building projects can be both feasible and profitable, thus leading to more of them. In a Sioux Falls, Iowa project similar to the redevelopment of the Pacific Hotel, tax incentives convinced a developer to turn an old library into affordable housing. That project, the first of its kind in the area, worked out so well that it stimulated the developer to embark on other, similar projects elsewhere in the state.
• Tax incentives can be an efficient use of taxpayer money. They can bring in far more in cash (private investment) and social benefits than they cost in lost revenue. Providing tax incentives to employers to help them provide health insurance for their employees, for instance, is usually far less expensive for the public than the consequences of those employees having no insurance – the cost of providing free or reduced-fee care, overuse of hospital emergency rooms, more and more serious illness because of lack of regular medical care, lost taxes because of lost work time, etc.

• Implications for society and economy The following potential applications are illustrative of those that we foresee.
  		Scientific research. By making explicit the argument relationships within and among mental models in the physical and social sciences, the CognitiveWeb will improve the comprehensibility of existing scientific research, and thus motivate critical evaluation of existing work and the creation of new work.
  		Funding and policy. The same means that serve the advancement of science can also further the management and justification of scientific funding, and facilitate, or even propel, technology transfer from research to industry.
  		Education and training. The CognitiveWeb will directly and simultaneously foster the development of critical thinking skills, communication skills, and domain knowledge. The CognitiveWeb will provide a vehicle for the critical review of ideas and the development of thought and planning at all scales
  		Intellectual history. The CognitiveWeb will preserve a historical record — a structured trace — of the development of ideas, policies, and social systems. By using the CognitiveWeb, historians and researchers would be able to identify arguments that supported, and were supported by, the falsified theories, and to identify surprising corollaries of discoveries and cross-domain similarities between of advances.
  		Corporate intranets. Corporate planning requires sensitivity to the market and internal resources. Using the proposed approach, corporations will be able to explicitly represent and monitor relationships between goals, policies, plans, actions, and outcomes throughout the company
  		Civil Society. Sustainable agriculture and rural development (SARD) Civil Society led participation in governmental and intergovernmental process. Issue-based outreach and education and coordinating local action with global planning for NGOs.
  		National Intelligence. The technologies underlying the CognitiveWeb are closely related to technologies of concern to intelligence analysts. The CognitiveWeb supports critical thinking about the meaning of evidence, as well as a means for analysts to reason about the uncertainty in their conclusions and the risk inherent in a situation.