That’s at best a semantic argument as refundable tax breaks can result in a net payment by the government. As in you can revive 1,400$ having never paid any money to the government.

A more common example is to pay nothing and also get a rebait to avoid paying taxes in the future.

I see. You think that the money you make belongs to the government, and they just allow you to keep a bit of it.

The $1400 stimulus payment was not a tax break nor was it income.

Not that 1,400$. 1,400$ of the 2,000$ child tax credit is refundable and that’s not a stimulus the GOP made part of the child tax credit refundable back in 2018.

Some nonrefundable tax tax credits cap at zero or the AMT for that year.

Other nonrefundable tax tax credits can get rolled over into future years, so people with actual incomes can still pay zero in some years. Aka they go to zero and roll over savings to next year.

However refundable credits mean an actual check even in years you paid zero taxes: American opportunity tax credit, Earned income tax credit, Child tax credit, Premium tax credit. Aka they go to zero then send you a check.

It not that common for people to get a check for the full amount, but it does happen.

The money actually does belong to the government. They print it. Distribute it. And then they take it back.

Reducing taxes, especially in a selective way, is essentially state spending money on subsidies.

Although you are correct, the point goes further than that because any system of taxation is effectively a subsidy to whatever doesn't get taxed. Income taxes cause over-allocation to assets, wealth taxes cause over-allocation to short term spending, taxing left handed people causes allocation to right handed people, etc. I like the idea of a land value tax/Georgism, from a philosophical belief that we should under-allocate to people whos claim to fame is that they got to the land first.

But nevertheless the original point stands - the state may be handing out advantages but it is not a form of spending. Not taking stuff is different to handing something out even if in some models they have equivalent effects.

That's abusing the word "subsidy".

A tax break on any farmer that grows corn is a corn subsidy. It’s the classic definition of a subsidy in that it reduces costs to create something.

Often things are written so exactly one company benefits when they agree to build something like a sports stadium in exchange for zero property taxes for N years. If that subsidy isn’t large large enough they may also hand out cash.

A tax break is not a subsidy.

A subsidy is a payment to the person.

If a farmer lost money one year, the tax break does not financially benefit him.

Money I have left over from paying taxes is not a "subsidy".

The common definition includes tax breaks see:

“subsidy is a benefit given to an individual, business, or institution, usually by the government. It can be direct (such as cash payments) or indirect (such as tax breaks). The subsidy is typically given to remove some type of burden, and it is often considered to be in the overall interest of the public, given to promote a social good or an economic policy.” https://www.investopedia.com/terms/s/subsidy.asp

“A subsidy is an incentive given by the government to individuals or businesses in the form of cash, grants, or tax breaks that improve the supply of certain goods and services.” https://corporatefinanceinstitute.com/resources/knowledge/ec...

That’s literally the first two definitions from searching DDG, here’s Wikipedia.

“A subsidy or government incentive is a form of financial aid or support extended to an economic sector (business, or individual) generally with the aim of promoting economic and social policy.[1] Although commonly extended from the government, the term subsidy can relate to any type of support – for example from NGOs or as implicit subsidies. Subsidies come in various forms including: direct (cash grants, interest-free loans) and indirect (tax breaks, insurance, low-interest loans, accelerated depreciation, rent rebates).[2][3] https://en.wikipedia.org/wiki/Subsidy

I don't agree with those definitions, but I'll have to concede the point.