The Moving Target of Tax Reform

25 Pages Posted: 2 Sep 2015

See all articles by Karen C. Burke

Karen C. Burke

University of Florida Levin College of Law

Grayson M.P. McCouch

University of Florida Levin College of Law

Date Written: 2015

Abstract

In 2000, Professor William Turnier proposed a package of three reforms to make the estate tax more “equitable” and “taxpayer-friendly.” All of his proposals — allowing a surviving spouse to inherit a deceased spouse’s unused exemption, replacing the state death tax credit with a deduction, and indexing the exemption for inflation — were eventually enacted. Today, the estate tax remains on the books, but changes in rates and exemptions have severely curtailed its role in the larger federal tax system. Income tax rate reductions for capital gains and dividends have further lightened the tax burden on capital income, and international pressure to reduce the corporate tax burden threatens to accelerate the increasingly unequal distribution of income and wealth. This Article argues that the trend of shifting tax burdens from capital to labor is neither desirable nor sustainable and suggests a deathtime capital gains tax and an accrual-based tax on unrealized appreciation in publicly traded stock as possible measures to make the federal tax system more equitable (though perhaps less taxpayer-friendly).

Suggested Citation

Burke, Karen C. and McCouch, Grayson M.P., The Moving Target of Tax Reform (2015). 93, N.C. L. Rev. 649 (2015), University of Florida Levin College of Law Research Paper No. 15-1, Available at SSRN: https://ssrn.com/abstract=2654317

Karen C. Burke (Contact Author)

University of Florida Levin College of Law ( email )

P.O. Box 117625
Gainesville, FL 32611-7625
United States

Grayson M.P. McCouch

University of Florida Levin College of Law ( email )

P.O. Box 117625
Gainesville, FL 32611-7625
United States

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