1 / 26

Tax policy

Tax policy. POLI 352A. Taxes: Extracting resources. Income Consumption Social insurance Wealth Corporation Tax expenditures. Varieties of tax policy. United States Progressive Heavy corporate burden Light consumption tax Lots of tax expenditures Sweden Regressive

Gideon
Download Presentation

Tax policy

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Tax policy POLI 352A

  2. Taxes: Extracting resources • Income • Consumption • Social insurance • Wealth • Corporation • Tax expenditures

  3. Varieties of tax policy • United States • Progressive • Heavy corporate burden • Light consumption tax • Lots of tax expenditures • Sweden • Regressive • High consumption tax • Light on active capital

  4. Varieties of tax policy • United Kingdom • Unstable and incoherent

  5. Tax expenditures in the United States

  6. Policy making regimes

  7. U.S.: Fragmentation • Fragmented political authority • Interest groups: Opportunities for narrow demands  Narrow organization of interests and demands  Heavy tax rates but • Narrow tax expenditures • Weak parties, interest groups  Hard to make social bargains  Liberals reject consumption tax • Even though it could finance social spending

  8. Sweden: Coherence and compromise • Proportional representation  Stable Social Democratic dominance • But minority = need for compromise • Interest groups and politicians: Incentives to compromise • Neo-corporatism, strong parties • Makes bargaining easier  Broad policy bargains • E.g., consumption taxes for social spending

  9. United Kingdom:Incoherence and instability • Centralized authority Power for policy change  Adversarial party politics • Politicians: Incentives to campaign on polarized promises • Keep them without compromise • But administratively impossible to reverse all previous choices

  10. Blame avoidance:Tax visibility • Least popular taxes are most visible • Property and income • Regressive, but less-visible taxes accepted • Social insurance and consumption  Big spenders rely more on less-visible taxes • How? • Social bargains using neo-corporatist structures

  11. Blame avoidance:Tax cutvisibility • Bush tax cuts • Far from median voter BUT • Overall costs delayed • Sunset provisions hide cost • Skewed distributive effects delayed • Immediate (but small), visible benefits for everyone • Framing

  12. Conclusion • Effects of institutional-interest group regimes • Fragmented • Inclusive • Adversarial • Institutions shape actors’ policy demands • Policy design crucial method of blame-avoidance • Policy “choices” don’t necessarily reflect intentions

  13. Debating policymaking regimes • Four policymaking regimes • Westminsters (Parliamentary, FPTP) pluralist interests • Parliamentary, PR, neo-corporatist interests • Presidential, weak parties, pluralist interests • -- Westminster plus federalism • Each group comes up with reasons why their regime is best • Define “best” – what criteria are you using? • If you use “democratic” as a criterion, define what you mean • Examples of types of policies • All group members take notes

More Related