Archive for the ‘VAT’ Category

What Tax Reform Would Mean for the States

What would fundamental changes in the federal tax code mean for state and local governments? Would it limit their ability to raise or borrow money? Would it make their revenue systems more or less progressive or even work more smoothly? Last Friday, I participated in a joint Tax Policy Center and UCLA Law School conference […]

What a Value-Added Tax Would Mean for the Tax Code—and the Economy

A well-designed Value-Added Tax could simplify the tax code for most households and finance significant reductions in corporate and individual income tax rates without adding to the budget deficit. And it could be a key piece of a revenue system that is both progressive and less intrusive in economic decisions than today’s law. That’s the […]

Why Higher Taxes Will Have to be Part of the Medium- and Long-Term Fiscal Solution

If we are going to reduce the medium- and long-deficit, new tax revenues must be part of the solution. And those taxes must be progressive and as conducive to economic growth as possible. Historical revenue levels will not be sufficient to fund the federal government in the future. We will need to control the ballooning […]

Pick Your Poison: VAT or Higher Income Tax Rates

With congressional deficit reduction efforts largely collapsed, the question remains: What are we going to do about the nation’s long-term budget mess? Since any realistic deficit reduction plan will require significant new revenues, is a Value-Added Tax a sensible way for government to raise those extra dollars? In an effort to find out, the Pew […]

What is a Flat Tax? (Surprise, it is a VAT!)

Rick Perry is reportedly going to announce his tax reform plan, a so-called flat tax. There are, as far as I know, no details about the rate or exemption level of the tax or whether it will allow deductions for things like charitable contributions or mortgage interest.  So I can’t comment on the specific proposal, […]

Cain’s 9-9-9 Plan Would Cut Taxes for the Rich, Raise Taxes for Almost Everyone Else

Herman Cain’s 9-9-9 tax plan would result in a massive tax cut for nearly all of the highest earning Americans and a steep average tax hike for everyone else, according to a new Tax Policy Center analysis. As Cain knows, when you are in the fast-food pizza business marketing is everything.  Your white cheese, pureed […]

Do Republicans Really Want to Cut Taxes on the Wealthy and Raise Them on Everyone Else?

Of all the curious rhetoric floating around both Washington and the campaign trail, the strangest may be the demand of many Republicans that Congress raise taxes for low-income working households even as it cuts taxes for the wealthy.  The left has, not surprisingly, gleefully leapt on the issue. And, honestly, it seems like terrible politics […]

The Bipartisan Policy Center’s Bold, Controversial Stab at the Deficit and Tax Reform

Another day. Another bold and controversial tax reform plan. This is getting very interesting. Today, the privately-funded Bipartisan Policy Center (BPC) released its own far-reaching fiscal proposal. Like the plan offered last week by Erskine Bowles and Alan Simpson, the co-chairs of President Obama’s Deficit Commission, this heavyweight task force aims to both slash the […]

Obama’s Business Tax Cuts

With the economy stalled and his party’s November electoral chances sagging, President Obama is rolling out a new plan to boost growth—a mix of infrastructure spending and business tax cuts. The tax changes make some sense on their own merits, although I’m not sure how much they’d do to jumpstart an economy that can’t seem […]

Conservatives and the VAT

Last week, the Senate voted 84-13 for the following proposition: “It is the sense of the Senate that the Value Added Tax is a massive tax increase that will cripple families on fixed income and only further push back America's economic recovery.” The sponsor was Senator John McCain, which is interesting because in his presidential campaign McCain endorsed a consumption tax, although not quite a VAT.