Book contents
- Frontmatter
- Contents
- Preface
- List of contributors
- 1 Introduction
- 2 Trends in federal tax progressivity, 1980–93
- COMMENTS
- 3 The lifetime incidence of state and local taxes: measuring changes during the 1980s
- COMMENTS
- 4 Trends in income inequality: the impact of, and implications for, tax policy
- COMMENTS
- 5 The efficiency cost of increased progressivity
- COMMENTS
- 6 On the high-income Laffer curve
- COMMENTS
- 7 Tax progressivity and household portfolios: descriptive evidence from the Survey of Consumer Finances
- COMMENTS
- 8 Progressivity of capital gains taxation with optimal portfolio selection
- COMMENTS
- 9 Perceptions of fairness in the crucible of tax policy
- COMMENTS
- 10 Progressive taxation, equity, and tax design
- Index
1 - Introduction
Published online by Cambridge University Press: 20 May 2010
- Frontmatter
- Contents
- Preface
- List of contributors
- 1 Introduction
- 2 Trends in federal tax progressivity, 1980–93
- COMMENTS
- 3 The lifetime incidence of state and local taxes: measuring changes during the 1980s
- COMMENTS
- 4 Trends in income inequality: the impact of, and implications for, tax policy
- COMMENTS
- 5 The efficiency cost of increased progressivity
- COMMENTS
- 6 On the high-income Laffer curve
- COMMENTS
- 7 Tax progressivity and household portfolios: descriptive evidence from the Survey of Consumer Finances
- COMMENTS
- 8 Progressivity of capital gains taxation with optimal portfolio selection
- COMMENTS
- 9 Perceptions of fairness in the crucible of tax policy
- COMMENTS
- 10 Progressive taxation, equity, and tax design
- Index
Summary
The question of tax progressivity – who should bear the tax burden – is a central one for tax policy. It has concerned tax philosophers for over a century, and has often dominated political debate over tax-reform options. The issue was certainly prominent in the U.S. presidential campaign of 1992, during which the Democrats proposed tax cuts for the middle class accompanied by tax increases for the wealthy and certain corporations. The Republicans countered by stressing the economic costs of higher taxes and proposed instead tax cuts on capital gains, which are largely received by upper-income individuals, and (at the Republican convention) an across-the-board tax cut for individuals.
The prominence of the tax progressivity issue puts economists in an uncomfortable position, because we know in our heart that progressivity is not solely an economic question. It is equally a matter of ethics, or moral philosophy, because it involves choosing between situations where some people are better off and others worse off. Economics cannot settle which people are more deserving. Economic reasoning cannot determine whether it is a good idea to take one dollar from a wealthy family in order to give one dollar – or, even more problematically, fifty cents – to a poor family.
Lionel Robbins, in his influential book An Essay on the Nature & Significance of Economic Science (first published in 1932), argued persuasively that for such issues the role of the economist should be to lay out the implications of various courses of action, and to let the policymaker decide among these choices.
- Type
- Chapter
- Information
- Tax Progressivity and Income Inequality , pp. 1 - 8Publisher: Cambridge University PressPrint publication year: 1994
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