Tax — Federal
Retirement Tax Incentives Are Ripe for Reform
Current Incentives Are Expensive, Inefficient, and Inequitable
Current tax incentives for retirement saving are expensive, inequitable, and economically inefficient, giving the largest subsidies to the people who least need help in saving adequately for retirement and are most able to shift assets to capture the subsidies. These subsidies are ripe for reform that can help accomplish two important goals — raising revenue for deficit reduction and tax-reform goals, and improving retirement saving incentives for low- and moderate-income households, the groups with the most people who need to boost their retirement assets. Read more
Several dozen temporary tax-expenditure provisions, collectively known as “tax extenders” because Congress routinely extends them, are set to expire again at year’s end. More such provisions expire at the end of 2014. Given the importance of addressing mid-term and long-term deficits, policymakers should make a firm commitment to pay for any extension of these provisions.
- Four Timing Gimmicks That Could Disguise Fiscally Irresponsible Individual Tax Reform
- The Problem With Deficit-Neutral Tax Reform
- Tax Expenditures: Ripe for Reform, Needed for Deficit Reduction
- The Next Act: Further Deficit Reduction Must Include a Mix of Revenues and Spending Cuts
The income tax on individuals and the payroll tax, which is deducted from workers’ wages and used to help finance Social Security and Medicare, each made up about 40 percent of federal revenues in 2010. The federal government also collects revenue from corporate taxes, excise taxes, and other sources.
The Center analyzes major tax proposals, examining their likely effects on the economy and on the government’s ability to address critical national needs, especially over the long term. We place particular emphasis on the effects of tax proposals on households at different income levels. In addition, we analyze trends in the level of federal revenues, income distribution, and tax burdens.
December 19, 2013
Updated December 19, 2013
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