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A User's Guide To Proposals To Replace The U.S. Tax System And Strangle Fiscal Policy, Neil H. Buchanan
A User's Guide To Proposals To Replace The U.S. Tax System And Strangle Fiscal Policy, Neil H. Buchanan
Neil H. Buchanan
This article reviews several familiar plans to alter the structure of taxation, including the flat tax, a VAT, and the USA Tax. With the significant exception of a simplified income tax system, every plan to replace the current U.S. federal tax system would move us in precisely the wrong direction. These plans would abandon income taxation entirely in an attempt to solve problems that do not exist, and they are based on a flawed ideal of a neutral tax code. The companion to these plans is an even more misguided set of proposals (some in the form of constitutional amendments) …
Taxes, Saving, And Macroeconomics, Neil H. Buchanan
Taxes, Saving, And Macroeconomics, Neil H. Buchanan
Neil H. Buchanan
In response to increasing calls for policies to raise the U.S. saving rate, proposals are once again being offered in Congress to change the tax base from income to consumption. Beyond the important issues of income distribution (that is, outright unfairness) inherent in such a plan, it would simply not work. Indeed, it is based on a fundamental mismeasurement of what counts as saving in the U.S. economy. The logical sequence underlying this proposal is wrong at two crucial points: lowering or eliminating taxes on saving is unlikely to increase saving, and higher saving would be unlikely to increase investment …