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How to Raise $1 Trillion Without a VAT or a Rate Hike

8 Pages Posted: 10 Jul 2010  

Calvin H. Johnson

University of Texas at Austin - School of Law

Date Written: July 5, 2010

Abstract

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.

Keywords: Tax Reform, Revenue Enhancement, Tax Accounting

JEL Classification: H20, H21, K34

Suggested Citation

Johnson, Calvin H., How to Raise $1 Trillion Without a VAT or a Rate Hike (July 5, 2010). Tax Notes, Vol. 128, p. 101, July 5, 2010. Available at SSRN: https://ssrn.com/abstract=1636915

Calvin Harsha Johnson (Contact Author)

University of Texas at Austin - School of Law ( email )

727 East Dean Keeton Street
Austin, TX 78705
United States
512-232-1306 (Phone)
512-232-2399 (Fax)

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