Tax and Expenditure Policy
Recent Submissions
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Texas Tax Options
(2006)The State of Texas is contemplating sweeping changes in its revenue structure as part of a reform of the system of K-12 school finance in the state, with the main goal being a reduction in local school property taxes coupled with increased state level funding for education. This paper, which is an updated and abbreviated version of a report prepared ... -
Financial Integration and Cyclicality of Monetary Policy in Small Open Economies
(2007)Should countries follow counter-cyclical or pro-cyclical monetary policies? This paper documents that in contrast to developed economies, developing countries tend to follow pro-cyclical monetary policies. The paper then constructs a New-Keynesian small open economy model with wage rigidity and solves for the optimal monetary policy under different ... -
Consumption-Based Direct Taxes: A Guided Tour of the Amusement Park
(2007)Although consumption-based direct taxation has long been advocated in academic and policy circles, very few countries have actually implemented such taxes. This article provides an overview of alternative approaches to direct consumption taxation and examines arguments favoring consumption taxes over income taxes. It then describes and analyzes efforts ... -
Should Electronic Commerce Be Subject to Preferential Tax Treatment?
(2007)This paper examines theoretical arguments supporting preferential sales tax treatment of electronic commerce, using a version of the standard optimal commodity tax model that includes distributional concerns, tax-exempt goods, a subset of individuals with highly elastic demand for Internet goods (which are close but imperfect substitutes for similar ... -
The Impact of H.R. 25 on Housing and the Homebuilding Industry
(2008)This report examines the macroeconomic and transitional effects of implementing a specific type of consumption tax reform—the national retail sales tax known as the FairTax, as specified in H.R. 25—with a focus on the effects of such a reform on the housing sector, including reforminduced reductions in the prices of existing housing. The analysis is ...
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