Overcoming The Fiscal Trilemma With Two Progressive Consumption Tax Supplements
AbstractThis article recommends a tax reform strategy that can accomplish three objectives: (1) raise sufficient revenue to deal with long run budget challenges; (2) promote long run economic growth; (3) provide progressivity in the face of increasing inequality. The strategy for overcoming this fiscal trilemma is to retain (with modification) the personal income tax, the corporate income tax, and the payroll tax, and add two progressive consumption tax supplements: a value added tax made progressive by a refundable VAT credit on the 1040, and a progressive consumption surtax on the 1040.
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Bibliographic InfoPaper provided by University of Delaware, Department of Economics in its series Working Papers with number 14-04.
Length: 40 pages
Date of creation: 2014
Date of revision:
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More information through EDIRC
Tax reform; Progressive consumption tax supplements;
Find related papers by JEL classification:
- H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
- H24 - Public Economics - - Taxation, Subsidies, and Revenue - - - Personal Income and Other Nonbusiness Taxes and Subsidies
- H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
This paper has been announced in the following NEP Reports:
- NEP-ACC-2014-01-17 (Accounting & Auditing)
- NEP-ALL-2014-01-17 (All new papers)
- NEP-PBE-2014-01-17 (Public Economics)
- NEP-PUB-2014-01-17 (Public Finance)
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