How to Raise $1 Trillion Without a VAT or a Rate Hike
Calvin H. Johnson
University of Texas at Austin - School of Law
July 5, 2010
Tax Notes, Vol. 128, p. 101, July 5, 2010
There is an impending crisis in which revenue is needed to contain the federal deficit, now projected at $1.3 trillion a year. Some have said that individual income tax rates will need to go up to 85 percent, and some have advocated a federal VAT, FAIR tax, or sales tax, with rates as high as 61 percent. This article shows the best way to raise $1 trillion without either a VAT or a rate increase, mostly by requiring that our tax accounting better reflect economic income. Doing so will make the tax system both fairer and more efficient. Table 1 lists ways to raise $1 trillion. The list, however, cannot be adopted without a crisis.
This article is part of the Shelf Project, a collaboration among tax professionals to develop and perfect proposals to raise revenue.
Number of Pages in PDF File: 8
Keywords: Tax Reform, Revenue Enhancement, Tax Accounting
JEL Classification: H20, H21, K34
Date posted: July 10, 2010