The 2017 Tax Cuts and Jobs Act (TCJA) was the largest corporate tax reform in a generation, lowering the corporate tax rate from 35 percent to 21 percent, temporarily allowing full expensing for short-lived assets (referred to as bonus depreciation), and overhauling the international tax code.
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Policymakers on Capitol Hill should prioritize permanent pro-growth policy in the coming years as the economy struggles with inflation and the recovery from the pandemic.
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The latest tax gap report from the IRS has generated much media attention—and much misunderstanding.
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A harmonized EU tax base is a project in the making. Policymakers have a chance to put the Union on a path for increased investment and economic growth by focusing on the details of capital cost recovery.
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In recognition of the fact that there are better and worse ways to raise revenue, our Index focuses on how state tax revenue is raised, not how much. The rankings, therefore, reflect how well states structure their tax systems.
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If the EU is going to harmonize its tax base, it should do so in a way that increases the efficiency and competitiveness of tax policy for the EU as a whole, and not just seek out the lowest common denominator.
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Instead of adopting a highly distortive property tax assessment limit, policymakers should consider how similar goals could be met through other means.
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While there are many factors that affect a country’s economic performance, taxes play an important role. A well-structured tax code is easy for taxpayers to comply with and can promote economic development while raising sufficient revenue for a government’s priorities.
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If tax increases are included in a package, international experience points toward raising consumption taxes, rationalizing tax expenditures, and broadening the tax base—not hiking income taxes.
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High property taxes levied not only on land but also on buildings and structures can discourage investment in infrastructure, which businesses would have to pay additional tax on.
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The global minimum tax agreement known as Pillar Two is intended to curb profit shifting. However, OECD countries already have a variety of mechanisms in place that seek to prevent base erosion and profit shifting by multinational corporations.
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Outside of the pandemic years, this year’s federal deficit is the highest in U.S. history. While tax revenue has increased about 28 percent since the pre-pandemic year 2019, spending has increased about 46 percent. Annual deficits are headed towards $3 trillion over the next few years.
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Can an organization rightfully be called a “nonprofit” if it almost always makes money? And what if most of that organization’s income comes from “business income,” should it legitimately be considered a “charity”?
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In recent years, European countries have undertaken a series of tax reforms designed to maintain tax revenue levels while protecting households and businesses from high inflation.
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Any move to repeal the cap or enhance the deduction would disproportionately benefit higher earners, making the tax code more regressive.
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As Congress continues its work on the fiscal year 2024 appropriations process and associated tax provisions, it should consider an often-overlooked tax provision: the limitation on deductions companies take for interest payments.
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Now is the time for lawmakers to focus on long-term fiscal sustainability, as further delay will only make an eventual fiscal reckoning that much harder and more painful. Congressional leaders should follow through on convening a fiscal commission to deal with the long-term budgetary challenges facing the country.
35 min read
Policymakers at all levels of government should avoid the pitfalls of incentives. Instead, they should focus on creating a more efficient, neutral, and structurally sound tax code to the benefit of all types of business investment.
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A growing international tax agreement known as Pillar Two presents two new threats to the U.S. tax base: potential lost revenue and limitations on Congress’s ability to set its own tax policy.
39 min read
One year after its enactment, there are concerns about the Inflation Reduction Acts overall fiscal impact, the additional complexity it introduces to the tax system, and the sustainability of its initiatives.