In this lesson plan, students will discover why there are better and worse ways for governments to raise a dollar of revenue. Students will 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, and learn about the basics of “dynamic scoring.”
Designing tax policy in a way that sustainably finances government activities while minimizing distortions is important for supporting a productive economy.
5 min read
The VAT is a consumption tax assessed on the value added in each production stage of a good or service. Every business along the value chain receives a tax credit for the VAT already paid. The end consumer does not, making it a tax on final consumption.
4 min read
According to the 2021 International Tax Competitiveness Index, Switzerland has the best-structured consumption tax among OECD countries while Poland has the worst-structured consumption tax code.
2 min read
Policymakers and taxpayers should understand the scope of tax changes necessary to fully pay for the large-scale social spending programs that would be initiated under the Build Back Better Act.
6 min read
According to the 2021 International Tax Competitiveness Index, Switzerland has the best-structured consumption tax among OECD countries while Poland has the worst-structured consumption tax code.
2 min read
Tax Foundation testimony on the diversity of tax systems within the EU, three important ways to consider reforms by Member States, and several recommendations for the EU Parliament’s Subcommittee on Tax Matters to consider.
10 min read
Ireland and France levy the highest excise duties on cigarettes in the EU, at €8.42 ($9.60) and €6.61 ($7.53) per 20-cigarette pack, respectively. This compares to an EU average of €3.34 ($3.80). Bulgaria (€1.81 or $2.06) and Poland (€2.08 or $2.37) levy the lowest excise duties.
2 min read
While Congress continues to debate how to pay for President Biden’s spending proposals in the fiscal year 2022 budget, it is useful to consider the economic impact of a range of financing options in addition to the President’s proposed tax increases.
3 min read
As economies are starting to recover and growth is expected to rebound in the region during 2021, Asian and Pacific countries should start exploring changes to their fiscal tax policies while carefully evaluating the optimal time for eliminating fiscal stimulus and temporary tax relief.
4 min read
To reduce tax compliance and administrative costs, most countries have VAT exemption thresholds: If a business is below a certain annual revenue threshold, it is not required to participate in the VAT system.
2 min read
As economic activity resumes and the task of accounting for the deficits incurred in navigating the crisis of the past year becomes the focus of fiscal policy deliberations, a greater reliance on VAT could be an important tool in ensuring fiscal stability going forward. Countries should use this as an opportunity to improve VAT systems by re-examining carveouts in the form of exemptions and reduced rates.
2 min read
Governments often justify higher tax burdens with more extensive public services. However, the cost of these services can be more than half of an average worker’s salary.
21 min read
There’s a useful contrast between two revenue options related to President Biden’s infrastructure push. The president’s American Jobs Plan includes a proposal to raise the corporate tax rate to 28 percent. Meanwhile, historically, the gas tax is the main revenue source for transportation funding.
8 min read
Taxes on goods and services were on average the greatest source of tax revenue for Latin American and Caribbean countries
5 min read
To help countries face the pandemic-related financing needs while reducing inequality, the International Monetary Fund (IMF) has released a series of policy recommendations based on a temporary COVID-19 tax, levied on high incomes or wealth.
4 min read
A year ago, it seemed possible that New Hampshire was headed toward a triggered tax increase. Instead, lawmakers may trim business tax rates and begin the phaseout of the state’s tax on interest and dividend income, which would take away the asterisk and make New Hampshire the ninth state to forgo an individual income tax altogether.
4 min read
Hungary relies the most on consumption tax revenue, at 45.3 percent of total tax revenue, followed by Latvia and Estonia at 45.1 percent and 42.4 percent, respectively.
2 min read