Research Report Mitigating the Potential Inequity of Reducing Corporate Rates
Dan Halperin
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Some tax proposals would reduce the marginal corporate tax rate. Others would boost the top individual rate. Although a differential between corporate and individual rates could reduce the overall tax on distributed corporate income, it could also enable higher-income taxpayers to shelter income from taxation. This paper explains how denying the lower corporate rate to income from services and passive investments combined with provisions that prevent people from permanently escaping tax on retained earnings would mitigate this problem.
Research and Evidence Tax and Income Supports Upward Mobility
Expertise Upward Mobility and Inequality Taxes and the Economy
Tags Fiscal policy Taxes and business Federal budget and economy