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 Policy Forum: Business Tax Reform in the United States and Canada

2019 ◽  
Vol 67 (1) ◽  
pp. 57-66
Author(s):  
Ken McKenzie ◽  
Michael Smart
Keyword(s):  
Tax Reform ◽  
The United States ◽  
Economic Effects ◽  
Tax Rates ◽  
The Us ◽  
Key Features ◽  
Business Tax ◽  
Jobs Act ◽  
Policy Forum ◽  
Tax Depreciation

The authors examine some of the key features of the US Tax Cuts and Jobs Act (TCJA) and discuss the implications for Canadian corporations and government revenues. They show that the tax advantage that Canada enjoyed prior to the TCJA has declined significantly, in terms of both statutory and effective (marginal and average) tax rates. They discuss the economic effects of possible responses to the TCJA by Canadian governments, including cutting statutory rates and accelerating tax depreciation deductions. Looking ahead, the authors argue that it would be preferable to focus on a more fundamental tax reform based on the taxation of economic rents.

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.

scholarly journals The Impact of the Tax Cuts and Jobs Act of 2017 on the US Government Debt

2019 ◽  
Vol 7 (4) ◽  
pp. 01-09
Author(s):  
Min Xu ◽  
Suk Kim ◽  
Jeanne David
Keyword(s):  
Government Debt ◽  
Us History ◽  
The Great Recession ◽  
Tax Relief ◽  
The Us ◽  
Us Government ◽  
Federal Debt ◽  
Jobs Act ◽  
The Impact ◽  
Tax Cuts

There have been three major tax cuts in the modern US history: 1) the Tax Cuts and Jobs Act of 2017; 2) the Economic Growth and Tax Relief Reconciliation Act of 2001; and 3) the Economic Recovery Act of 1981. Each of the first two major tax cuts had increased the federal debt. Just about everybody agrees that US federal debt is on an unsustainable path. Can we afford another major tax cut without trigging a major economic disaster such as the Great Recession of 2007-2009? This article discusses an overview of this new law, the impact of the first two major tax cuts on the federal debt, the impact of the Tax Cuts and Job Acts on the US government debt, and its consequences.

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 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.

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 Reregulating Indonesian Stock Buyback: A Lesson From United States

Yuridika ◽  
2021 ◽  
Vol 36 (3) ◽  
pp. 559
Author(s):  
Didik Farkhan Alisyahdi ◽  
Diffaryza Zaki Rahman
Keyword(s):  
Economic Development ◽  
Income Tax ◽  
Limited Liability ◽  
Corporate Income Tax ◽  
Share Repurchases ◽  
Share Repurchase ◽  
The Us ◽  
Stock Buyback ◽  
Jobs Act ◽  
Tax Cuts

This article compares the corporate income tax cuts enacted by the Indonesian COVID-19 Relief Law and the US Tax Cuts and Jobs Act. It investigates the correlation between the tax cuts in the Tax Cuts and Jobs Act, economic development, and share repurchases in the US. It seeks to identify appropriate limitations on share repurchases in Indonesia following the enactment of the COVID-19 Relief Law. This research was carried out using the juridical normative method by tracing the literature and laws concerning share repurchase arrangements in Indonesia and the US. The results show that there is a slight positive correlation between the reduction of corporate income tax and economic development in the US and that the US income tax cuts have caused significant growth in share repurchases. After the enactment of the Indonesian COVID-19 Relief Law, which also reduced corporate income taxes, Indonesia may be on the verge of extensive share repurchase activity, as occurred in the US. To tackle this problem, we recommend amending Law No. 40 of 2007 concerning limited liability companies to re-regulate the restriction on share repurchases.

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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