Tax Policy & Reform: Rejecting 'Tax Utopianism' in Favor of 'Tax Diversification'
Boston Bar Association, Tax Section
The United States relies greatly on income taxes and payroll taxes at the federal level, to the exclusions of other possible tax bases such as consumption, pollution, etc. Discussions about "tax reform" consistently collapse into debates about reforming or improving the income and payroll tax bases.
At this program, Ameek Ashok Ponda will examine other possible bases for taxation, and investigate how these other tax bases can complement or reduce (rather than outright replace) income and payroll taxes.
The key insights are:
- any tax base is basically just a measurement system that will have some flaws (or at a minimum, limits to its precision)
- distortions and other stresses grow exponentially in relation to the tax rate, and thus
- a taxing jurisdiction should diversify (with multiple tax bases and low tax rates) rather than pursue a single tax base strategy with high tax rates.
For more information, visit the Boston Bar Association.