The basic principles of effective taxation would choose to avoid over-reliance on any one tax that can create on the inflows..

Up and down cycles

Explanation:

Dependence or over-reliance on any one tax can lead to problems due to the fluctuating nature of taxation system. For instance, if only property tax is relied upon here then the property tax will be dependent upon property prices and the real estate industry. Any major decline or deterioration due to economic recession or any market monopolies can result in a down cycle and reduced tax. Even marginal down cycles can be costly for the government if the taxation system is over-reliant on that tax and can severely affect government's spending power.

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