Taxing your country's economic activity always produces less activity.
In the short term. that's possible true, but I think only in the very short term. For the longer term, it has to be more complicated than that, as it depends on what you do with the tax receipts. If I reduce tax and stop providing all the things the state provides to help people to be productive (sick pay, education, health care, transport infrastructure), could I not reasonably expect less activity? The inverse, where I tax activity, yet provide things that the same activity requires (educated, healthy, productive workers) could I not observe an increase in activity?