The Real Corporate Tax Game
A recent article in The New York Times entitled "The Corporate Tax Game" details the tricky politics of corporate tax reform, especially when it comes to deciding how to pay for a rate reduction. With a variety of interest groups out there, businesses may be divided over the tax preferences that should be on the chopping block. The article in particular draws attention to the international tax code and the debate over how to treat foreign-source income, a debate which got another contribution from Rosanne Altshuler and Harry Grubert evaluating many different international tax reforms.
Our corporate tax calculator is a useful tool for demonstrating the trade-offs that are inherent with corporate tax reform. Users are able to choose a revenue target and then pick revenue-raising or revenue-losing options. The calculator then shows the statutory rate that satisfies these criteria. It makes quite explicit what it could take to produce the kind of tax reform the user wants to see.
In light of the NYT article, the calculator is a good preview of what would be involved in navigating both interest group politics and policy concerns.
Click here to try the corporate tax calculator.