Archive for the ‘Tax Proposals’ Category

Bigger, Cleaner, and More Efficient: A Carbon-Corporate Tax Swap

The Cato Institute has organized an online forum to debate pro-growth economic policy reforms. Tax Policy Center scholars Bill Gale, Donald Marron, and Eric Toder have each contributed to the discussion. The United States could reduce its contribution to global climate change and increase domestic prosperity by taxing emissions of carbon dioxide and other greenhouse […]

Tax Reform: One Shining Moment or “Blah, Blah, Blah”

Given that prospects for tax reform were virtually nil before the election, the Republican recapture of the Senate has to have made prospects for tax reform better.  But I still have the strong sense that tax reform will be a tough slog in the next Congress. Let’s start on corporate side.  It is often noted […]

What Ronald Reagan Didn’t Say About the EITC

I like the Earned Income Tax Credit (EITC). It encourages work and allows millions of low-wage workers and their kids to escape a life of poverty. Democrats support it as a critical part of the safety net. Republicans back it because it rewards work and family. Just last week, House Budget Committee Chairman Paul Ryan […]

The “Helping Working Families Afford Child Care Act” Would Help, but Doesn’t Solve the Timing Mismatch

The Child and Dependent Care Tax Credit (CDCTC) does not work for low-income families. It fails on three counts – the credit is nonrefundable, covers only a portion of expenses, and comes long after expenses have been incurred. Senators Jeanne Shaheen (D-NH), Barbara Boxer (D-CA), Patty Murray (D-WA), and Kristin Gillibrand (D-NY) have proposed the […]

How Progressive is Obama’s Tax Policy?

Has President Obama’s tax policy reduced income inequality? It depends on what you are comparing it to. White House Council of Economic Advisors chief Jason Furman claims that President Obama’s tax policies have sharply reduced inequality. Today’s Washington Post Wonkblog featured some new tables from the Tax Policy Center that show Obama tax policy is […]

“Pension Smoothing” is a Sham

Pity House Ways & Means Committee Chairman Dave Camp. He wants to rewrite the tax code in a serious way, but instead he’s spending his days trying to come up with imaginary revenue sources to pay for important spending priorities like rebuilding our crumbling highways. Tomorrow, his committee will consider a proposal to partially pay […]

The Strange Fruit of the House’s Bonus Depreciation Bill

When the Ways & Means Committee sent the House a measure to make permanent extra-generous tax subsidies for firms that purchase capital equipment, I noted in passing that the bill included a provision extending “bonus depreciation” rules to fruit and nut trees. If I had read the bill more carefully, I would have noticed that while […]

Len Burman’s Brief for a Health Care VAT

In the cover essay in the current issue of The Milken Institute Review, Len Burman calls for a Value-Added Tax (VAT) to pay for government health care costs. Len, the director of Tax Policy Center (and, thus, my boss), argues that a dedicated—and fully transparent–health care VAT would increase public support for efforts to slow the […]

A Flash Tax for the Flash Boys

Michael Lewis spotlights high-frequency traders with his new book, Flash Boys.  These traders use high-speed computers and fast connections to outrace investors, and other traders, to the market.  They now account for more than half of all U.S. stock trades.  And the flash boys spend billions to save milliseconds (by, for example, laying expensive fiber-optic […]

If Congress Lets Firms Expense Investments, It Should Take Away Their Interest Deduction

Egged on by business lobbyists, congressional tax writers seem increasingly interested in allowing firms to rapidly write off the cost of their capital investments. Especially in the House, lawmakers would allow small businesses to expense the full cost of their investments in the year they are acquired, and let larger firms heavily front-load tax depreciation […]