Topic: Tax Expenditures

A New Look at Who Benefits from Tax Expenditures

By :: December 19th, 2013

Who benefits from the tax credits, deductions and exclusions that have become such an integral part of the modern tax code? Nearly all of us. And that’s why any tax reform that eliminates or scales back many of these preferences in return for lower tax rates is so hard to do. The Tax Policy Center […]

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Analyzing Taxes and Transfers Together

By :: December 5th, 2013

Government redistributes income through tax and spending programs. Nearly everyone pays some tax – be it federal or state income taxes, payroll taxes, or sales taxes. The tax system also affects people by delivering a host of benefits through tax expenditures (subsidies like the mortgage interest deduction or the child tax credit).   And broad spending […]

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The Democrats Never-Ending Search for Tax Loophole Closers

By :: November 13th, 2013

Senate Democrats are circulating a list of a dozen tax “loopholes” they’d like to close as part of a budget package. It is unlikely that Republicans will agree to any of them except as part of broad tax reform, but it is worth taking a quick look at a few on their merits. Some represent […]

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As Budget Talks Start, Beware the Bogus Revenue Hikes

By :: October 31st, 2013

As House and Senate budget negotiators sit down (eight months late), the inevitable issue of new revenues has already raised its head. Predictably, Democrats insist that any fiscal deal include new taxes. Equally predictably, Republicans demand that it must not. But behind the scenes, Washington’s wink-and-nod crowd thinks it has a solution: Raise new tax […]

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Congress Shouldn’t Forget About Tax Entitlements In Its Search for Deficit Reduction

By :: October 22nd, 2013

Yesterday, Washington Post columnist Bob Samuelson urged lawmakers to “just eliminate…the whole notion of entitlements.”  His provocative argument: The very word “entitlement” makes people believe these programs are somehow untouchable. They are, for instance, effectively exempt from the sequester’s cuts even though they represent two-thirds of all government spending. Bob is on to something but he […]

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Senator Lee’s New Reform Plan Focuses on Young Children

By :: September 19th, 2013

At an AEI panel discussion earlier this week, Senator Mike Lee (R-Utah) unveiled the Family Fairness and Opportunity Tax Reform Act. The centerpiece is an additional $2,500 tax credit for all children under age 17. The plan retains the $1,000 child tax credit under current law. Unlike the current credit, the new credit would not […]

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How Do High-Income People Avoid Paying Federal Income Tax?

By :: September 5th, 2013

Most of the 43 percent of Americans who the Tax Policy Center projects will pay no federal income tax this year make very little money. Some are middle-income households that qualify for enough tax preferences to zero out their tax bills. But more than 70,000 households with income over $200,000 will pay no federal income […]

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Beware of Tax Reform That Promises Deep Rate Cuts

By :: August 8th, 2013

Two new studies show just how hard a time Congress will have trying to slash tax rates without adding trillions of dollars to the budget deficit and producing a massive tax windfall for the highest-income American households. Last week, the congressional Joint Committee on Taxation estimated that a tax plan that cuts individual rates to […]

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Not All Curbs on Tax Preferences Are Created Equal

By :: July 10th, 2013

Because politicians seem unwilling to confront specific individual tax preferences, it is likely that any broad-based tax reform will be based on across-the-board curbs on deductions, credits, and exclusions. That’s how lawmakers could generate the revenue they need to reduce tax rates and (perhaps) help reduce the deficit without seeming to tackle popular tax subsidies […]

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Can The Baucus-Hatch Blank Slate Plan Jump Start Tax Reform?

By :: June 27th, 2013

Senators Max Baucus (D-MT) and Orrin Hatch (R-UT), the chairman and senior Republican on the Senate Finance Committee, tried to jump-start the drive towards tax reform today with what they call a blank slate rewrite plan. Trouble is, it is not exactly a plan. And it isn’t quite a blank slate. Their idea is to get senators […]

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