The research below explores the economics of tax policy and the intellectual underpinnings of our efforts to quantify tax changes using our dynamic Taxes and Growth (TAG) macroeconomic model.
The Tax Foundation uses and maintains a General Equilibrium Model, known as our Taxes and Growth (TAG) Model to simulate the effects of government tax and spending policies on the economy and on government revenues and budgets.
9 min read
The Tax Foundation models tax policy using our proprietary Taxes and Growth model, illustrating the economic, revenue, and distributional impacts of different changes to the federal tax code. We’ve recently implemented improvements to the model that have been underway for the past several years, and we will be detailing them further in our forthcoming model methodology update.
4 min read
Lawmakers should use the most comprehensive analytical tools available to them—like dynamic scoring—to make informed decisions about policy changes.
5 min read
Recent empirical evidence shows that workers bear upwards of 70 percent of the corporate income tax burden, much more than popular tax models claim, which make errors in how they account for super-normal returns and the openness of our economy.
50 min read
Some tax hikes are more damaging than others, according to Congressional Budget Office (CBO) and new Tax Foundation economic modeling.
5 min read
In our latest report, we consider several theoretical arguments for carbon taxes and the evidence from carbon taxes implemented around the world related to emissions, economic growth, distribution and revenue recycling options, other environmental taxes, green subsidies, and environmental regulations.
49 min read
Our recent policy conference brought together academics and political leaders to present research on some of the most pressing issues in global tax policy and to discuss solutions that can unlock genuine global growth.
9 min read
Federal spending, deficits, and debt are at unsustainable levels. The proposed federal budget is laden with redundant programs, obsolete programs, corporate welfare, and nationalized industries. As Congress begins to craft the FY 2024 federal budget, it needs to establish a process of systematically reviewing programs and priorities.
Lawmakers should use the most comprehensive analytical tools available to them—like dynamic scoring—to make informed decisions about policy changes.
5 min read
History is clear. Lowering budget deficits via spending restraint frees resources for additional private output and jobs. Lowering them by raising taxes on business investment and labor services makes it harder to dis-inflate without a recession.
7 min read
As we near this year’s “lame duck” session of Congress, there has been renewed interest in reforming the child tax credit as part of a tax deal. Our new analysis highlights the trade-offs that policymakers will face
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If ever there was a paycheck protection program, defending people from bracket creep may be the most important one ever designed.
6 min read
Research has shown that spikes in tax rates can act as barriers to upward mobility. High marginal tax rates might directly influence the decisions workers make about accepting a raise, working additional hours, or whether they might remain on government benefits.
8 min read
Research almost invariably shows a negative relationship between income tax rates and gross domestic product (GDP). Cuts to marginal tax rates are highly correlated with decreases in the unemployment rate.
26 min read
The Biden administration has pledged to not raise taxes on anyone earning less than $400,000 a year. However, the administration’s corporate tax proposals would likely violate that pledge, given that corporations are comprised of people who also might earn less than $400,000.
3 min read
With the Biden administration proposing a variety of new taxes, it is worth revisiting the literature on how taxes, particularly on corporate and individual income, can impact economic growth.
9 min read
Some tax hikes are more damaging than others, according to Congressional Budget Office (CBO) and new Tax Foundation economic modeling.
5 min read
A new study illustrates how overlooking an important element of the tax system—the structure of the tax base—can lead to an incomplete understanding of how tax reform impacts the economy.
4 min read
Based on the CBO’s assessment of the economic and budgetary effects of federal investment, lawmakers should look to spur private sector investment rather than try to enact a massive federal infrastructure bill.
5 min read
Discover why there are better and worse ways for governments to raise a dollar of revenue. Compare the economic impact of the three basic tax types—taxes on what you earn, buy, and own—including three specific taxes within each category. Learn about the basics of “dynamic scoring,” one tool economists can use to compare the economic and revenue impact of different tax policies.
