Challenge of Individual Income Tax Reform: An Economic Analysis of Tax Base Broadening. March 22, 2012

摘要

Congressional interest in a major reform of the individual income tax that would broaden the base and use the additional tax revenues to lower rates and/or reduce the deficit has increased. The President's Fiscal Commission, for example, proposed an individual income tax reform with three objectives: to broaden the base and lower the tax rate, to contribute to deficit reduction, and to maintain or increase the progressivity of the tax system. The Fiscal Commission proposed to broaden the tax base by eliminating or modifying most tax expenditures. One legislative proposal, S. 727, introduced by Senators Wyden, Begich, and Coats, would broaden the tax base by eliminating many tax expenditures and reduce tax rates. One way to broaden the tax base is to eliminate or reduce tax expenditures, which have been in the tax code since the passage of the progressive income tax in 1913.