The Tax Policy Blog

February 24, 2016

Today, the Ways and Means Committee held a hearing on international tax reform. One issue that came up was profit shifting. Most people agree that profit shifting happens and reduces that amount of corporate tax revenue the government collects, but academic research suggests there is significant uncertainty about the magnitude of the problem. Even so, lawmakers may still want to address it. If they do, what should be done about it? Fortunately, some research tells how we could reduce it....

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February 23, 2016

Over the weekend, Governor Jeb Bush suspended his bid for the Republican presidential nomination. As journalists and pundits take stock of the campaign, tax policy wonks have an opportunity to look back at the Bush tax...

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February 22, 2016

As tax filing season gets underway, many taxpayers are figuring out whether to take the standard deduction or to itemize. How many Americans choose each option?

According to the most recent IRS data, for the 2013 tax year,

  • 30.1 percent of households chose to itemize their deductions (44 million returns).
  • 68.5 percent of households chose to take...
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February 19, 2016

Some of the most substantial deductions in the federal tax code are the itemized deductions for state and local income, sales, and real estate taxes. This map shows the variation, by county, in the amounts of these deductions. The measurement used here is mean deduction amount taken per return: in other words, the total of all of the deductions for state and local taxes, divided by number of returns filed. The results show that the benefits of these deductions vary substantially from county...

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February 18, 2016

I just e-mailed this letter (PDF version here) to IRS Commissioner Koskinen, CCing several others. Paper copies of the letter and supporting documents are being hand-delivered to Commissioner Koskinen, Representative Chaffetz, and Senator Crapo.

February 18, 2016

John Koskinen
IRS Commissioner
1111 Constitution Avenue NW, Suite 5480...

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February 17, 2016

Over at Bloomberg View, Noah Smith has an interesting column about the future of U.S. economic policy. He begins with the worry that the U.S. has run out of ideas for growing the economy:

This presidential election has driven home a problem that others have been noticing the last few years: The U.S. seems to be out of ideas for economic growth… We’ve been...

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February 16, 2016

In its newly released budget plan, the Obama Administration calls for an additional tax on oil of $10 per barrel. A budget document explains that the tax would actually be the “equivalent of $10.25 per barrel of crude oil” and that the tax rate would be indexed to inflation. The tax would be assessed on domestic and imported oil but exempt exported oil.

The Administration says much of the...

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February 13, 2016

Justice Antonin Scalia, who passed away today at the age of 79, certainly left his mark on American law.

Appointed to the Supreme Court by President Reagan in 1986, he quickly became part of the majority’s federalism revolution, putting limits on the Court’s Commerce Clause power for the first time since the 1930s. He wrote the majority opinion in the 2010...

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February 12, 2016

At one point during last night’s Democratic debate, Hillary Clinton argued that Bernie Sanders has overestimated the benefits and underestimated the costs of his Medicare-for-all plan on the average American household. Clinton said:

CLINTON: Last week in a CNN town...

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February 11, 2016

Tax Policy Center (TPC) today released their analysis of Senator Marco Rubio’s tax plan. Overall, their findings are similar to those of a Tax Foundation analysis released a year ago.

Tax Foundation in March 2015 analyzed the Rubio-Lee plan, a predecessor to Rubio’s current plan as analyzed...

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February 11, 2016

The Cleveland income tax (which stacks on top of the Ohio state income tax) has stood at 2 percent for 34 years. Cleveland City Council President Kevin Kelley—with backing from the mayor and some other council members—has a proposal to increase the tax to 2.5 percent to fill a budget hole the city is facing.

The proposal has been drawing quite a bit of...

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February 11, 2016

Earlier this week, the Obama administration released its final budget, for the 2017 fiscal year. Many of the tax proposals in the budget will undoubtedly be “dead on arrival” in Congress, including the President’s proposed ...

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February 11, 2016

A new paper published in the Journal of Financial Economics finds that countries with high tax rates on corporate income also have higher corporate leverage ratios. This paper improves upon the methodologies of prior research that had struggled to confirm a link between tax rates and corporate structure.

Economic theory predicts that businesses measure the benefits of raising capital from lenders...

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February 10, 2016

One notable characteristic of this year’s presidential primaries is that many candidates have put together detailed tax plans—some of which are substantial departures from the status quo. However, no candidates would change taxes nearly as much as the two winners of last night’s New Hampshire primaries: businessman Donald Trump and Senator Bernie Sanders.

Donald Trump’s plan cuts the top income tax rate to 25 percent (from a high of 39.6 percent) and extends a zero income tax bracket...

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February 09, 2016

Last year, 4,279 individuals renounced their U.S. citizenship or terminated their long-term U.S. residency, according to the Treasury Department. This figure is up by 25.3 percent from 2014, when 3,415 individuals renounced their citizenship. All in all, 2015 was a record-setting year for expatriation: more Americans gave up their citizenship last year than in...

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Subscribe to Tax Foundation - Tax Foundation's Tax Policy Blog The Tax Policy Blog is the official blog of the Tax Foundation, a non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937. Our economists welcome your feedback. If you would like to send an e-mail to the author of a blog post, please click on that person's name to locate his or her e-mail address or visit our staff page here.

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