Anybody out there? The Future of Tax
Gitte Heij
Sign up for access to the world's latest research
checkGet notified about relevant papers
checkSave papers to use in your research
checkJoin the discussion with peers
checkTrack your impact
Abstract
Most tax revenue and tax policy research papers discuss historical developments and the current challenges of raising tax revenue. This paper takes a long term view and addresses the possible futures of tax revenue using the Three Horizons model. With the help of this model, it outlines possible futures for raising tax revenue in an environment of rapidly evolving technology, automation, globalization, the rising power of powerful interest groups, and the trend of increased accumulation of wealth in the hands of fewer taxpayers. By analyzing possible futures, the assumptions of key stakeholders are tested.
Figures (1)
Related papers
FUTURE DEVELOPMENTS IN TAX POLICY
Only a few years ago, the future of tax policy seemed clear to all. The rhetoric, and to some extent the reality, of tax policy was dominated by the image of "levelling the playing field," and the much-touted phenomenon of "globalization" was taken to mean that the field was likely to be levelled at something close to the lowest common denominator. Governments were no longer growing, the "welfare state" was increasingly seen as obsolete, and only the occasional out-of-touch crank seemed at all concerned about the redistributive consequences of reducing taxes on wealth and high incomes. Not only political fashion and economic reality but also the growing intellectual capital built up by economists about the "deadweight" losses of progressive taxes added weight to these trends. Income tax rates were coming down, the value-added tax (VAT) was sweeping the world, the use of tax measures for non-fiscal ends such as encouraging investment in favoured industries was out of fashion everywhere, and intellectual enthusiasm for consumption and flat-rate taxes was at a new high. In the fashion of prophets at all times, most fiscal pundits at the end of the 1980s assured us that the future would be like the immediate past, only more so.
Tax Policy: Past, Present, and Future
Cet article donne un aperçu personnel des grands changements, théoriques et pratiques, qui se sont produits en politique fiscale au cours des dernières décennies. Il présente également certaines hypothèses sur les tendances à venir dans ce domaine.
Tax Policy and the Economy: Volume 4
Like virtually all developed economies, the United States is projected to experience a dramatic demographic transition over the next 50 years. By 2040 31 percent of the U.S. population will be 55 and older compared to 21 percent today (see ). Most of this aging will occur among the older old with the fraction of the population over 65 predicted to almost double. While the burden on the working population of supporting dependents will be reduced somewhat due to the lower projected ratio of children to middle-aged adults, the overall dependency ratio (the ratio of those under 18 plus those 65 and older to those 18 and 64) will rise from its value of .616 in the 1980s to .730 in the 2040s.
Tax Policy for a New Era: Promoting Economic Growth and Fairness
SSRN Electronic Journal, 2000
"Turning the Tide on Tax" (final draft version w/ references) - Fabian Review (Winter 2014)
Fabian Review, 2014
Nobody should be surprised that the main political parties are currently doing all they can to avoid talking seriously about tax. With the least predictable election in living memory on the horizon, no party wants to give their rivals the opportunity to wheel out the kind of 'tax bombshell' accusations that worked so well for John Major in 1992. But, whatever the shortrun tactical demands of the coming election campaign, the next government is going to have to rescue Britain's decrepit, ramshackle tax system.
Cloudy with a Chance of Taxation
Florida Tax Review, 2019
The growth of the digital economy, and, in particular, cloud computing, has put a significant strain on sales taxation and other consumption tax systems. The borderless, anonymous, and digital nature of cloud computing raises questions about the paradigm used to determine the character of the transaction and the location where consumption, and therefore, taxation occurs. From an American perspective, the effective resolution of these issues continues to grow in importance in light of the recent U.S. Supreme Court decision in South Dakota v. Wayfair and the growing number of U.S. businesses transacting overseas in jurisdictions that impose value-added taxes (VATs). The cloud magnifies difficulties with VAT compliance and enforcement, as businesses increasingly are subject to VAT laws in multiple jurisdictions. Tax authorities therefore have to collect from remote vendors who have numerous opportunities for VAT avoidance and evasion. The outcome of these challenges is unfair competition, a burden on international trade, and a huge gap in VAT revenues. In this important article, we closely analyze these cutting-edge challenges and contribute to the debate on how to tax the digital economy. We argue that while the approaches taken by both the Organisation for Economic Cooperation and Development, of which the United States is a member, and the European Union introduce some noteworthy improvements to the current system, more substantial measures are necessary. Thus, we propose a range of fundamental changes that include improving the existing registration-based VAT system through the enhanced use of new technologies, replacing the current system with a blockchain real-time basis VAT system, and shifting the VAT collection burden from suppliers to payment intermediaries. As the digital transformation of the economy accelerates, each of these changes will help adapt consumption taxation to the modern realities of our digital era.
Tax Policy and the Economy, Volume 5
This paper presents a set of generational accounts that can be used to assess the fiscal burden current generations are placing on future generations. The generational accounts indicate, in present value, the net amount that current and future generations are projected to pay to the government now and in the future. These accounts can be understood in terms of the government's intertemporal (long-run) budget constraint. We thank Jinyong Cai, Ritu Nayyar, and Bash Hardeo for excellent research assistance and
Andrew Young School of Policy Studies Annual Conference on Public Finance Issues Alternative Methods of Taxing Individuals Taxing Potential Income: A Second Look at Presumptive Taxes
The goal of this paper is to bring together two unconventional approaches to taxing individual income, the potential income tax and presumptive income taxes. In this paper we argue that the combination of two approaches considerably increases the attraction of each of the separate concepts; in particular a presumptive taxation perspective transforms the potential income tax into a more operational concept while a potential income tax perspective provides strong theoretical justification to presumptive income taxes. The paper also illustrates how a potential/presumptive income tax could be implemented for labor income using data from the U.S. as an example.
Related papers
Tax Policy Challenges in the 21st Century: Smart Tax Policies. Trying to change the world progressively, as the global phenomenon "Pokémon Go
2016
The article discusses fundamentals aspects of taxes and training role of the Government, the Prime Minister in the 21 st century. Firstly, the text revises some of the main changes currently taking place in the new century. Secondly, the study points out some aspects to consider in the development of Tax process, and Smart Tax Policies.
Blueprints and pathways: the shifting foundations of tax reform
1985
Less than two decades ago, there was a broad consensus among economists concerned with the design and reform of tax systems. Today this consensus has broken down. The theory of equitable taxation has been challenged by the competing theories of optimal taxation and fiscal exchange. The paper examines the analytical foundations of the three approaches and comments on their influence on recent reform proposals. Implications for tax policy and design are summarized in a set of tables. The paper also analyzes the second-best nature of partial tax reform and comments on the possibilities of a synthesis among traditions.
A stocktake of the tax system and directions for reform
2015
Tax reform is in the news daily. Calls for fundamental reform have become louder, but there are diverse views on the direction and scope of the reform that is needed. The Liberal/National Coalition Government has committed to a White Paper process on Tax Reform, which the Government has indicated will commence with the release of a discussion paper designed to prompt a national conversation about tax reform. The Government has also commenced a White Paper process for reform of the federation (DPMC 2014; 2015), which is examining the distribution of responsibilities between State and Commonwealth governments, with implications for federal financial relations, including taxation. But what is tax reform? What needs fixing in Australia's tax system, why, and what can and should be done? Hotly debated issues range from whether to broaden the base or increase the rate of the Goods and Services Tax (GST), to how we can properly tax multinational corporations. There is debate about ...
Taxing for the Future: An Intergenerational Perspective [Book Chapter via Edward Elgar]
The European debt crisis has raised fears that fiscal unsustainability in the region is triggering a collapse in the Euro zone, which could pull the European Union, the United States and Japan into recession because of the huge debt levels of these three major Organisation for Economic Cooperation and Development (OECD) regions (OECD 2011). These and other recent fiscal instability issues in Greece, Portugal and Spain have reminded us of the urgent need for fiscal consolidation and for policies to achieve fiscal sustainability that can potentially avoid the world plunging into a second global recession. This is particularly urgent for debt- stricken nations in both the East and the West. In order to provide some guidance on how policymakers can promote fiscal sustainability, the following issues will be covered in this paper: ● The role of fiscal sustainability to enhance intergenerational equity and thereby long- term sustainable economic development; ● The importance of designing a ‘just tax system’ for intergenerational justice; and, ● Case studies from both developed (Australia) and developing economies (Bangladesh) in which policymakers are trying to implement measures to improve fiscal sustainability for sustainable economic development.
Developing Tax Policy in a Complex and Changing World
Economic Analysis and Policy, 2008
This paper examines issues affecting the formulation of tax policy through to the development of actual proposals by tax policy-makers. This is done taking account of the possibility that too narrow an approach to this process can produce misleading conclusions and that proposals for tax reform may be inappropriate when the wider context of the tax system as a whole and the environment in which it has to operate are considered. Two issues are used to illustrate this situation -tax compliance and tax simplification. The paper concludes that in developing tax policy it is important to ensure that the wider context is taken into account and it also outlines a practical approach to achieve this aim.
Changes to tax legislation in 2023
IPF notes, 2023
, the Croatian Government presented changes to tax legislation affecting various forms of taxation. The key changes pertain to the introduction of a relief for calculating contributions to Pillar I of pension insurance, the abolition of surtax and autonomy of local government units (cities and municipalities) to freely define the personal income tax (PIT) rate and the increase of personal allowances in the income tax system. This Note analyses the effects of the proposed measures to the tax burden of a hypothetical employee, discusses their advantages and potential threats to autonomous definition of tax rates and suggests potential alternatives to the proposed contribution relief. Key changes The Croatian Government has highlighted the following as primary objectives of the tax reform: "increasing the real purchasing power #131
The Impact of Tax Gap on Future Tax Reforms
Australian Economic Review, 2007
The Right Tax at the Right Time
SSRN Electronic Journal, 2016
The companion paper to this (Capital Taxation in an Age of Inequality) argues that a moderate flat-rate (proportional) income tax on capital imposed and collected annually has attractive theoretical and political economy properties that can be harnessed in actual tax instrument design. This paper continues the analysis by specifying in detail how such a tax might be designed.
The Avoidable Excess Burden of Broad-Based U.S. Taxes
Public Finance Review, 2002
The excess burden of taxes can be reduced by shifting taxes from labor and capital onto land and by replacing progressive taxes with proportional taxes. This article uses a dynamic general equilibrium model to develop estimates of the magnitudes of reduction in excess burden that can be achieved in the United States by (1) incrementally shifting revenue from five broad-based taxes to land, (2) replacing the current progressive income tax with a flat tax, and (3) shifting as much taxation as possible to land.
Tax Reform
2012
issued its report in 1990. Dr. Bradford's research has centered on public sector economics and he is particularly noted as an authority on taxation. His published papers address a wide range of topics, including investigations of conscription for military service, public utility pricing, criteria for public investment, local government and the economic structure of urban areas, and a variety of income tax issues. Recent work including insurance companies. His 1986 book, Untangling the Income Tax, provides a comprehensive review of income taxes and their alternatives, including consumption taxes. He is editor of Distributional Analysis of Tax Policy. A 1960 graduate of Amherst College, Dr. Bradford holds advanced degrees from Harvard University (M.S., Applied Mathematics, 1962) and Stanford University (Ph.D., Economics, 1966). He was awarded the degree of Doctor of Humane Letters by Amherst College in 1985. ** Leslie B. Samuels is a partner of Cleary, Gottlieb, Steen & Hamilton, based in the New York office. His practice focuses on international taxation, domestic taxation and related issues, including mergers and acquisitions, foreign direct investment in the United States, and new financial products. Mr.
Loading Preview
Sorry, preview is currently unavailable. You can download the paper by clicking the button above.