Harrop formula

The Harrop formula is an economic concept used in tax policy and public finance, particularly in the context of assessing the relationship between public expenditure and taxation. It primarily refers to a formula introduced by the economist A. Harrop, which relates to the budgetary implications of government policies. The primary purpose of the Harrop formula is to highlight the need for sufficient sources of revenue to fund public services without leading to excessive government borrowing or unsustainable debt levels.