Evaluating the New US Pass-Through Rules
British Tax Review, Issue 1, 2018
21 Pages Posted: 22 Mar 2018 Last revised: 28 Apr 2018
Date Written: March 15, 2018
The pass-through rules that the US Congress enacted in 2017 - permitting the owners of unincorporated businesses in favored industries to escape tax on 20 per cent of their income - achieved a rare and unenviable trifecta, by making the tax system less efficient, less fair, and more complicated. It lacked any coherent (or even clearly articulated) underlying principle, was shoddily executed, and ought to be promptly repealed. Given the broader surrounding circumstances, the mere fact of its enactment sends out a disturbing message about disregard among high-ranking US policymakers for basic principles of competence, transparency, and fair governance.
Note: This material was first published by Sweet & Maxwell Limited in Daniel Shaviro, Evaluating the New US Pass-Through Rules, Issue 1 of the 2018 British Tax Review, pages 49-67 and is reproduced by agreement with the Publishers.
Keywords: passthrough rules, corporate taxation, income taxation, business taxation
JEL Classification: H20, H24, H25, H26
Suggested Citation: Suggested Citation