Table of Contents
Preface xi
1 Background and History 1
Understanding Taxes 1
Nature of Taxation: What Is a Tax? 1
Goals of Taxation 2
Types of Taxes 4
Tax Base and Tax Rate 11
Principles of Taxation 14
A Brief History of the U.S. Tax System 16
2 Problems, Controversies, and Solutions 29
Equity Issues (Fairness) 29
The U.S. Tax System 31
Sources of Tax Law 32
National Tax Policy 33
The Political Process 36
Tax Administration 38
The Federal Income Tax 39
Income and Exclusions 40
Treatment of Individuals 42
Deductions 42
Business Taxation 43
Taxation of Investment Income 44
Federal Tax Reform 44
Criticisms of the Current Tax System 44
Difficulties in Implementing Tax Reform 47
Tax Reform Lessons: The Marriage Penalty 49
Federal Tax Reform Options 52
Incremental versus Fundamental Tax Reform 52
Goals of Reform 53
Incremental Tax Reform 55
Alternatives to the Income Tax 56
National Retail Sales Tax 56
Value-Added Tax 58
Flat Tax 59
Personal Consumption Tax 61
How to Judge the Alternatives 62
2012 Tax Reform Proposals 64
3 Special U.S. Issues 69
State Tax Systems 69
Complexity and Multiple Taxation 69
Historical Overview 71
Modern State Tax Systems 73
Multistate Taxation 76
Unitary Taxation 79
Local Taxation 79
Local Property Tax 80
School Funding Reform 83
Taxing Internet Sales 85
Business Taxes and International Competitiveness 87
International Business Operations 89
Carbon Taxes and Cap-and-Trade Programs 90
How Carbon Taxes Work 92
Cap and Trade 92
4 Chronology 95
5 Biographical Sketches 135
William Reynolds (Bill) Archer Jr., 135
Richard K. (Dick) Armey 136
William Warren (Bill) Bradley 136
William Jennings Bryan 137
George Herbert Walker Bush 138
George Walker Bush 139
Andrew Carnegie 139
Henry Clay 140
Steve Forbes (Malcolm Stevenson Forbes Jr.) 141
Henry George 141
Alexander Hamilton 142
Howard Jarvis 143
Jack French Kemp 143
John Fitzgerald Kennedy 144
Russell B. Long 145
N. Gregory Mankiw 146
Wilbur D. Mills 146
Ronald Wilson Reagan 147
Franklin Delano Roosevelt 148
Irwin Schiff 148
Adam Smith 149
6 Data and Documents 151
Understanding the Tax Reform Debate: Background, Criteria, and Questions 151
Potential Impact of Alternative Taxes on Taxpayers and Administrators 162
Ten Largest Tax Expenditures 193
Excerpts from Progress and Poverty 195
Treasury Deputy Assistant Secretary (Tax Analysis) Leonard Burman Testimony before the House Committee on Ways and Means Subcommittee on Oversight 206
7 Directory of Organizations and Associations 221
8 Resources 233
Selected Print Resources 233
Selected Books on Tax Reform 234
Selected Scholarly Articles on Tax Reform 239
Selected Popular Press Articles on Tax Reform 245
Selected Nonprint Resources 246
Videos 246
Internet Resources 247
Proprietary Databases 247
Web Sites 247
Glossary 255
Index 267
About the Author 277