TaxProf Blog

Editor: Paul L. Caron, Dean
Pepperdine University School of Law

Monday, March 20, 2017

Kamin & Setser:  The House Plan's Bad Math — Over-Estimates Of Revenue From A Border Adjustment

David Kamin (NYU) & Brad Setser (Council on Foreign Relations), House Plan's Bad Math: Over-Estimates of Revenue from a Border Adjustment:

One of the largest revenue raisers in the House Republicans’ framework for business tax reform is a “border adjustment.” However, projections of revenue from the border adjustment overstate revenue in two ways.

The medium-term projections assume that there will be no or very limited avoidance of a border adjusted tax. The long-term revenue projections require an unrealistically large trade deficit.

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