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Peculiar institutions: A British perspective on tax policy in the United States

  • Michael Keen

By both effect and example, tax policy in the United States has a huge impact on the rest of the world. This paper explores five features of the American tax system that seem, from a British and European perspective, to be both especially peculiar and potentially instructive. These are: the remarkably low overall level of taxation; the absence of a value added tax (or any other general national tax on consumption); the absence of any explicit interstate equalisation; the marginal subsidisation of low earnings under the Earned Income Tax Credit; and the fragmentation of power in policymaking, an important aspect of which is the role played by the Constitution.

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Article provided by Institute for Fiscal Studies in its journal Fiscal Studies.

Volume (Year): 18 (1997)
Issue (Month): 4 (November)
Pages: 371-400

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Handle: RePEc:ifs:fistud:v:18:y:1997:i:4:p:371-400
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