"Logical Limits" of Tax Bill Arguments

Research Report

"Logical Limits" of Tax Bill Arguments

August 2, 1999

Abstract

Senior Fellow Eugene Steuerle examines the merits of a tax cut, and finds: Tax cuts are a valid means of achieving smaller government, but they only work if expenditures somehow follow a similar path, especially in the long-term. By the same token, not all tax cuts are bad nor are all spending increases bad. As for progressivity, there are valid arguments to be made in favor of a progressive system, but not every change must add to overall progressivity. Neither can the supply-side argument for caring about only the top tax rates always hold up unless one really favors head taxes over all other forms of taxation.

To reuse content from Urban Institute, visit copyright.com, search for the publications, choose from a list of licenses, and complete the transaction.