scholarly journals Did the 2017 Tax Reform Discriminate against Blue-State Voters?

2020 ◽  
Vol 73 (4) ◽  
pp. 1087-1108
Author(s):  
David Altig ◽  
Alan Auerbach ◽  
Patrick Higgins ◽  
Darryl Koehler ◽  
Laurence Kotlikoff ◽  
...  
Keyword(s):  
Differential Effect ◽  
Tax Reform ◽  
Local Property ◽  
Income Taxation ◽  
Average Increase ◽  
Percent Increase ◽  
Property Income ◽  
State And Local ◽  
Jobs Act ◽  
Tax Cuts

The Tax Cuts and Jobs Act of 2017 (TCJA) significantly changed federal income taxation, including limiting SALT (state and local property, income, and sales taxes) deductibility to $10,000. We estimate the TCJA’s differential effect on red- and blue-state taxpayers and the SALT limitation’s contribution to this differential. We find an average increase in remaining lifetime spending of 1.6 percent in red states versus 1.3 percent in blue states. Among the richest 10 percent of households, red states enjoyed a 2 percent increase compared to 1.2 percent in blue states, with the gap driven almost entirely by the SALT deduction limitation.

scholarly journals Is This Tax Reform, or Just Confusion?

2018 ◽  
Vol 32 (4) ◽  
pp. 73-96 ◽  
Author(s):  
Joel Slemrod
Keyword(s):  
United States ◽  
Tax Reform ◽  
The United States ◽  
The Political ◽  
Political Will ◽  
Tax Base ◽  
Tax System ◽  
The Law ◽  
Jobs Act ◽  
Tax Cuts

Based on the experience of recent decades, the United States apparently musters the political will to change its tax system comprehensively about every 30 years, so it seems especially important to get it right when the chance arises. Based on the strong public statements of economists opposing and supporting the Tax Cuts and Jobs Act of 2017, a causal observer might wonder whether this law was tax reform or mere confusion. In this paper, I address that question and, more importantly, offer an assessment of the Tax Cuts and Jobs Act. The law is clearly not “tax reform” as economists usually use that term: that is, it does not seek to broaden the tax base and reduce marginal rates in a roughly revenue-neutral manner. However, the law is not just a muddle. It seeks to address some widely acknowledged issues with corporate taxation, and takes some steps toward broadening the tax base, in part by reducing the incentive to itemize deductions.

Trying not to Lose Ground: State and Local Government Advocacy during Passage of the 2017 Tax Cuts and Jobs Act

2019 ◽  
Vol 49 (3) ◽  
pp. 407-436 ◽  
Author(s):  
J Wesley Leckrone
Keyword(s):  
Partisan Politics ◽  
Municipal Bond ◽  
Advocacy Organizations ◽  
Tax Expenditures ◽  
Self Interest ◽  
Tax Exempt ◽  
State And Local Government ◽  
State And Local ◽  
Jobs Act ◽  
Tax Cuts

Abstract The Tax Cuts and Jobs Act of 2017 (TCJA) was the first major federal tax reform in a generation. This article examines the priority issues of fifty-seven intergovernmental advocacy organizations during the legislation’s passage. These groups played defense from the start, in response to efforts by President Trump and congressional Republicans to streamline the tax code by eliminating tax expenditures. Blocking the potential elimination of the state and local tax (SALT) deduction and preserving the tax exempt status of municipal bond interest represented priorities for most organizations. Ultimately, the TCJA preserved many tax expenditures important to intergovernmental advocacy organizations. However, the SALT deduction was capped at $10,000, representing a big loss. This case study evaluates when and under what conditions the intergovernmental lobby influences federal policy-making. It finds that while state and local groups use a variety of tactics, their ability to navigate partisan politics and harness the self-interest of members of Congress is necessary to success.

scholarly journals The New Tax Legislative and Regulatory Process

2020 ◽  
Vol 73 (4) ◽  
pp. 1135-1162
Author(s):  
Rebecca M. Kysar
Keyword(s):  
Tax Reform ◽  
Implementation Process ◽  
Regulatory Process ◽  
Legislative Process ◽  
The Future ◽  
Set Up ◽  
Jobs Act ◽  
Reconciliation Process ◽  
Implementation Challenge ◽  
Tax Cuts

This paper compares the enactment and implementation process for the 2017 Tax Cuts and Jobs Act (TCJA) to prior tax reform acts, as well as situates it within other developments in the legislative process more generally. It details how the 2017 enactment process solidifies reconciliation as the primary vehicle for the enactment of major tax measures, a trend nearly two decades in the making. The ambitious scope of the TCJA, as well as the rushed and partisan reconciliation process by which it was enacted, has led to ambiguities and instability in the legislation. These features have, in turn, posed an enormous implementation challenge for Treasury, which has led to some troubling results. Finally, reconciliation has set up the opportunity for Congress to engage in budget gimmicks in the future. This paper discusses these trends and proposes solutions to them.

scholarly journals Think Tank Soldiers in the Battle for Tax Reform

2020 ◽  
Vol 11 (1) ◽  
Author(s):  
Renee Irvin ◽  
Jes Sokolowski
Keyword(s):  
Nonprofit Organizations ◽  
Tax Policy ◽  
Tax Reform ◽  
Think Tanks ◽  
Think Tank ◽  
Political Decision ◽  
Advocacy Organizations ◽  
Jobs Act ◽  
Political Decision Making ◽  
Tax Cuts

AbstractContemporary scholars argue that high wealth donors in the U.S. influence political decision making through generous funding of nonprofit organizations like think tanks. In response to that potential influence, some endorse curbs on implicit subsidies that favor higher-income donors more than lower-income donors. To highlight the debate, this study selects a particular topic – tax policy – that generates highly partisan viewpoints and political agendas. The article first models predicted partisan operational differences, based on donors’ ideological differences. The study then explores the financial, staffing, and board resources of think tanks and associated advocacy organizations. The data were collected in the year immediately prior to the passage of the 2017 U.S. Tax Cuts and Jobs Act, providing a snapshot view of contrasting operations of left-, centrist, and right-leaning tax policy think tanks. Given the notably more generous resources utilized by right-leaning tax policy organizations, it is possible that donor wealth differences enabled right-leaning nonprofits to contribute their influence to get the historic tax reform package passed. However, the successful passage of the Tax Cuts and Jobs Act could have resulted as well from the more targeted messaging and narrative framing employed by right-leaning think tanks and advocacy organizations.

scholarly journals The Tax Reform Act of 1986: Its Impact on Pennsylvania Farmers

1987 ◽  
Vol 16 (2) ◽  
pp. 84-92
Author(s):  
William Grisley ◽  
Larry C. Jenkins
Keyword(s):  
Beef Cattle ◽  
Tax Reform ◽  
Income Taxes ◽  
Capital Gain ◽  
Average Increase ◽  
Percent Increase ◽  
Short Run ◽  
Gross Income

The Tax Reform Act of 1986 was studied to determine its short-run impact on Pennsylvania farmers. For the 3,059 farms studied, the average increase in total tax obligation resulting from the TRA of 1986 was $446 per farm, or a 48 percent increase in federal income taxes actually paid in 1984. Differences in impact were found across farms categorized by commodity type. Egg producers were most severely impacted, while beef cattle producers least affected. In general, the increase in adjusted gross income was due to the loss of 60 percent exclusion on capital gain income.

The Tax Cuts and Jobs Act of 2017 and the Gig Economy: Why the Employee vs. Contractor Debate Matters More than Ever

2021 ◽  
pp. 088636872110602
Author(s):  
Stanley Veliotis ◽  
Balsam Steve
Keyword(s):  
Income Tax ◽  
Tax Reform ◽  
Point Of View ◽  
Tax Law ◽  
Court Cases ◽  
Independent Contractors ◽  
Gig Economy ◽  
Jobs Act ◽  
The U.S ◽  
Tax Cuts

The issue of whether workers are independent contractors or employees has become even more relevant with recently enacted and proposed legislation and court cases in many jurisdictions seeking to impose employee status on many Gig economy workforce participants, such as ride-share drivers. This article emphasizes that the U.S. income tax rules, especially after tax reform effective in 2018, makes employee status extremely tax-inefficient for these workers. This article explains the relevant tax law changes and provides various examples of typical settings to confirm that workers with even small relative work expenses are often better off as contractors from a tax point of view.

scholarly journals Policy Forum: International Effects of the 2017 US Tax Reform—A View from the Front Line

2019 ◽  
Vol 67 (1) ◽  
pp. 27-39
Author(s):  
Peter Harris ◽  
Michael Keen ◽  
Li Liu
Keyword(s):  
Tax Reform ◽  
Front Line ◽  
The Us ◽  
Business Tax ◽  
Jobs Act ◽  
Policy Forum ◽  
Tax Cuts

Proximity and close economic links put Canada on the front line in thinking through the effects of the US Tax Cuts and Jobs Act (TCJA). This article reviews the main channels by which the business tax provisions of the TCJA might affect Canada, and possible responses.

scholarly journals Measuring the Effects of Corporate Tax Cuts

2018 ◽  
Vol 32 (4) ◽  
pp. 97-120 ◽  
Author(s):  
Alan J. Auerbach
Keyword(s):  
Multinational Corporations ◽  
Income Tax ◽  
Capital Investment ◽  
Corporate Income Tax ◽  
Tax Law ◽  
Corporate Tax ◽  
The Law ◽  
Jobs Act ◽  
The Impact ◽  
Tax Cuts

On December 22, 2017, President Donald Trump signed the Tax Cuts and Jobs Act (TCJA), the most sweeping revision of US tax law since the Tax Reform Act of 1986. The law introduced many significant changes. However, perhaps none was as important as the changes in the treatment of traditional “C” corporations—those corporations subject to a separate corporate income tax. Beginning in 2018, the federal corporate tax rate fell from 35 percent to 21 percent, some investment qualified for immediate deduction as an expense, and multinational corporations faced a substantially modified treatment of their activities. This paper seeks to evaluate the impact of the Tax Cuts and Jobs Act to understand its effects on resource allocation and distribution. It compares US corporate tax rates to other countries before the 2017 tax law, and describes ways in which the US corporate sector has evolved that are especially relevant to tax policy. The discussion then turns the main changes of the Tax Cuts and Jobs Act of 2017 for the corporate income tax. A range of estimates suggests that the law is likely to contribute to increased US capital investment and, through that, an increase in US wages. The magnitude of these increases is extremely difficult to predict. Indeed, the public debate about the benefits of the new corporate tax provisions enacted (and the alternatives not adopted) has highlighted the limitations of standard approaches in distributional analysis to assigning corporate tax burdens.

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