The economic crisis caused by the coronavirus pandemic poses a triple challenge for tax policy in the United States. Lawmakers are tasked with crafting a policy response that will accelerate the economic recovery, reduce the mounting deficit, and protect the most vulnerable.
To assist lawmakers in navigating the challenge, and to help the American public understand the tax changes being proposed, the Tax Foundation’s Center for Federal Tax Policy modeled how 70 potential changes to the tax code would affect the U.S. economy, distribution of the tax burden, and federal revenue.
In tax policy there is an ever-present trade-off among how much revenue a tax will raise, who bears the burden of a tax, and what impact a tax will have on economic growth. Armed with the information in our new book, Options for Reforming America’s Tax Code 2.0, policymakers can debate the relative merits and trade-offs of each option to improve the tax code in a post-pandemic world.
The State Tax Competitiveness Index Is Your Guide to Economic “Wins Above Replacement”
Taxes are an important part of the mix, and modernizing a state’s tax structure helps position it for growth. States that rank better on the Index have better-structured tax codes, and states with better-structured tax codes get Wins Above Replacement.
5 min read
What a Democratic Congress Means for Federal Tax Policy in 2027
With Democrats retaking control of the US House of Representatives and US Senate, several new federal tax issues are on the table for 2027.
7 min read
How Tax Policy Fared on the Ballot in 2026
In red and blue states alike, voters showed wariness toward novel changes to the tax code, with two notable exceptions.
3 min read
UK Autumn Budget Prioritizes Short-Term Relief over Long-Term Growth
The UK’s 2026 Autumn Budget largely favors short-term relief over growth, highlighting the need for pro-growth reforms such as replacing the Stamp Duty Land Tax with annual property or land taxes.
8 min read
Economic Education Includes Addressing Tax Confusion
Economics isn’t just a course with supply and demand graphs and a quirky usage of “guns and butter.” It’s a discipline focused on incentives and responses, and we can see its impact all around us, shaping our world and our choices.
3 min read
What Is the US Debt Limit and Why Does It Matter?
The debt limit is one of Congress’s few chances to debate unsustainable borrowing, and reforms should create more room for bipartisan deficit reduction, not less.
6 min read
Congress Has a Chance to Improve the Taxpayer Experience in 2026
The Senate recently passed the Taxpayer Assistance and Service Act, which contains 65 provisions to improve tax administration and the IRS.
4 min read
New Research Finds That Revenue-Maximizing Top Tax Rate Likely Lower Than Previous Estimates
A new paper shows raising top income tax rates on the current tax base may not yield as much revenue as previously estimated, due to opportunities to shift income to different tax bases within the tax code.
5 min read
Property Tax Relief on the Ballot: Three Approaches, One Clear Winner
This November, states across the country are asking voters to consider changes to their state constitutions to address the burden of rising property taxes.
7 min read
How Much Does the US Government Lose to Tax Fraud?
While the government will never close the tax gap or fully eliminate tax fraud, lawmakers and the IRS can institute several reforms to reduce the gap, including simplifying the tax code, increasing third-party information reporting, and coordinating anti-fraud efforts.
7 min read