17 Pages Posted: 6 Apr 2007
In this report, Thompson argues that Congress should reject many of President Bush's February 2007 tax proposals and instead (1) return to the pre-2002 rate structure for high-bracket taxpayers, while making permanent tax relief for low- and middle-income taxpayers, (2) provide permanent relief from the alternative minimum tax for middle-income taxpayers by adding 45 percent and 50 percent brackets for taxpayers with super-high levels of income, (3) tax dividends at ordinary income rates with appropriate relief for low-bracket taxpayers, (4) reinstate the maximum 20 percent rate for capital gains of high-bracket taxpayers, (5) reinstate the estate tax with a $4 million exemption and an increase in the marginal rates for large estates, (5) codify the economic substance doctrine, and (6) adopt a current imputation system of taxation for controlled foreign corporations.
Keywords: President Bush's February 2007 tax proposals, proposed rate structures for taxpayers
JEL Classification: K34
Suggested Citation: Suggested Citation
Thompson, Jr., Samuel C., How Should Congress React to Bush's Tax Proposals?. Tax Notes, Vol. 114, p. 1233, March 26, 2007; UCLA School of Law, Law-Econ Research Paper No. 07-03. Available at SSRN: https://ssrn.com/abstract=976751