PORTUGAL AND THE LAFFER CURVE: Portugal to Speed Austerity Measures - WSJ.com
One wonders if Portugal isn't already on the down slope side of the Laffer Curve - i.e. taxes can be raised; but, with each raise, less total gross tax revenue is received.
An easy example is to think of sales taxes and the economic-utility function. As some point, no matter what the 'utility' the cost will trump the combined please and value of buying something. When that happens, something isn't bought.
It may be that with a 23% VAT tax or the almost 50% car tax, people buy 2-3 fewer cars and they substitute food for that new dress or washing machine.
From the stores that are going out of business, it would certainly seem on the retail side of things, there must be less business and fewer jobs - all of which would seem to indicate the peak of the Laffer Curve tax take has been reached - and, sometime back!
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