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Shifting the Burden of Taxation from the Corporate to the Personal Level and Getting the Corporate Tax Rate Down to 15 PercentHarry GrubertU.S. Treasury Department; CESifo (Center for Economic Studies and Ifo Institute) Rosanne AltshulerRutgers University, New Brunswick/Piscataway, Faculty of Arts and Sciences-New Brunswick/Piscataway, Department of Economics June 28, 2016 National Tax Journal, Vol. 69, No. 3, 2016 Rutgers University, Department of Economics Departmental Working Papers, Number 2016-06 Abstract: We consider three plans for shifting the tax on corporate income to the personal level to achieve a significant reduction in the corporate tax rate. One plan eliminates the corporate tax and taxes dividends and the annual change in the value of publicly traded financial assets at ordinary rates. The second integrates corporate and shareholder taxes. The third lowers the corporate tax rate to 15 percent and taxes dividends and capital gains as ordinary income. To prevent large reductions in capital gains realizations and dividend payouts, an interest charge on taxes deferred during the holding period would be imposed when an asset is sold. We conclude that the third alternative is more robust than the other two.
Number of Pages in PDF File: 54 Keywords: tax reform, corporate income taxation, corporate tax integration JEL Classification: H24, H25, H32 Date posted: June 30, 2016Suggested CitationContact Information
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