Research by Author & Topic

Publications by Leonard E. Burman on Taxes and Social Programs

Policymakers are considering modifications to the tax treatment of employer-sponsored insurance (ESI) as a way to raise revenue to help pay for health reform and provide incentives to reduce health care costs. Understanding how current subsidies work is important to assessing health reform proposals. This brief presents essential information about the structure and distribution of existing tax subsidies for ESI and the implications for policy options.

Washington Times op-ed, May 19, 2009. Expanding health-care access is a top priority for the Obama administration, and leaders in Congress are on board. Political leaders also agree that any health insurance expansion must not increase the deficit. So how do we pay for health care without sinking the economy? The best option would be to phase in a value-added tax (VAT) dedicated to paying for health care. Packaged with the right bells and whistles, the VAT would help revive the economy, offset the burden on low-income families, and help slow health-care costs.

This paper outlines a plan for a VAT dedicated to paying for a new universal health insurance voucher combined with a vastly simplified and much flatter income tax. Top income tax rates could be cut to 25% or less and most taxpayers would not have to file returns. The health care voucher would offset the inherent regressivity of a VAT, since the voucher would be worth more than the VAT tax paid by most households. Moreover, with the VAT rate tied to health spending, the public would have a vested interest in reining in the growth of health care costs.

President Obama's 2010 Budget contains a number of tax provisions that would cut taxes for low- and middle-income households and raise taxes on wealthier taxpayers. This resource guide describes the tax proposals, offers more detailed commentary on key provisions, and links to tables showing the distributional effects of the overall proposal and various elements of the plan.

This report card evaluates the provisions of the Finance and Ways & Means Committees' conference tax stimulus bill (the "American Recovery and Reinvestment Tax Act of 2009"). The evaluation is preliminary and does not include all of the provisions in the bill most notably we omit provisions related to state and local debt and recovery zone credits. TPC will update the report card if significant changes occur before Congress passes the bill.

The Tax Policy Center has graded the key tax provisions of the pending Senate stimulus bill (the "American Recovery and Reinvestment Tax Plan of 2009"). Our grades, which rely on the bill's legislative language, focus on how well these measures would boost the economy in the short run. Accompanying write-ups describe current law, the proposed change, and the short- and long-term effects on the budget, the economy, fairness and tax complexity. We will update the report card as we learn more about the provisions and as the stimulus bill moves through Congress.

The Tax Policy Center has graded the key tax provisions of the pending House stimulus bill (the "American Recovery and Reinvestment Tax Plan of 2009"). Our grades, which rely on the bill's legislative language, focus on how well these measures would boost the economy in the short run. Accompanying write-ups describe current law, the proposed change, and the short- and long-term effects on the budget, the economy, fairness and tax complexity. We will update the report card as we learn more about the provisions and as the stimulus bill moves through Congress.

Analysts often add up tax expenditures to estimate an aggregate cost, but those tallies are inaccurate because they ignore interactions among provisions. We estimate that interactions raise the cost of nonbusiness tax expenditures by 5 to 8 percent, depending on whether an AMT patch is in effect. In 2007, these tax expenditures totaled about $750 billion—5.5 percent of GDP. While tax expenditures benefit taxpayers in all income groups, high-income households gain more relative to income than low-income ones. Although the AMT eliminates some tax preferences, it increases overall tax expenditures because most AMT taxpayers face higher marginal tax rates.

Presumptive Republican presidential nominee Sen. John McCain wants to suspend the federal gas tax for the summer travel season. Truckers say they like the idea. In this Marketplace commentary, Len Burman, Director of the Tax Policy Center explains why Senator McCain’s proposal won’t get us where he wants to go. http://marketplace.publicradio.org/display/web/2008/04/17/burman_commentary/

The question of whether to tax income from wealth has sparked debate since our country’s inception. Does taxing capital income ensure the progressivity of our system or merely discourage saving? Would switching our tax code to one that taxes only consumption be more efficient or only burden middle- and low-income people? And if we were to radically reform the way America taxes its citizens, how could we ensure that vital revenue would not be lost? Some analysts would even argue that, under our present byzantine tax system, we don’t really tax capital income at all. In this volume, eminent economists analyze the problems associated with taxing capital income and propose policy solutions, which are then challenged by their peers in informed commentary. It may not settle the debate, but policymakers, scholars, and the public will find a wealth of information and ideas to consider.