While the aim should be the elimination of the fiscal deficit, this macroeconomic objective should be reconciled with the microeconomic objective of reducing the tax burden on the economy, and, especially, continuing to alleviate the taxes on entrepreneurship. This aim has become even more pressing as we are facing increased tax competition, especially from neighboring countries and new members of the EU.
You may have noticed regular advertisements trumpeting some country’s low tax rates. Combating tax evasion can provide significant revenues, even in the short-run, while at the same time improving efficiency by leveling the playing field. The long-run solution is to have a more efficient and focused public sector that will absorb fewer resources to deliver its necessary services.