Why do govts raise interest rates to slow the economy instead of tax rises?

Question

With interest rate rises, the people in the most debt suffer the most. With tax rises, the highest paid suffer the most, and the govt has extra revenue to help the ones struggling the most. This is never considered by any govt. Why not?

In: 1129

Answer 1

Tax raises usually don’t come into effect until the next tax year and last for a year. Interest rates can be raised or lowered on a daily basis. They’re just a way more flexible tool.