TaxProf Blog

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

Thursday, November 2, 2017

Macroeconomic Modeling Of Tax Policy: A Comparison Of Current Methodologies

Alan Auerbach (UC-Berkeley), Itai Grinberg (Georgetown), Thomas Barthold (Joint Committee on Taxation), Nicholas Bull (Joint Committee on Taxation), Gavin Elkins (Tax Foundation), Pamela Moomau (Joint Committee on Taxation), Rachel Moore (Joint Committee on Taxation), Benjamin Page (Tax Policy Center), Brandon Pecoraro (Joint Committee on Taxation) & Kyle Pomerleau (Tax Foundation), Macroeconomic Modeling of Tax Policy: A Comparison of Current Methodologies, 70 Nat'l Tax J. ___ (2017):

The macroeconomic effects of tax reform are a subject of significant discussion and controversy. In 2015, the House of Representatives adopted a new “dynamic scoring” rule requiring a point estimate within the budget window of the deficit effect due to the macroeconomic response to certain proposed tax legislation. The revenue estimates provided by the staff of the Joint Committee on Taxation (JCT) for major tax bills often play a critical role in Congressional deliberations and public discussion of those bills. The JCT has long had macroeconomic analytic capability, and in recent years, responding to Congress’ interest in macrodynamic estimates for purposes of scoring legislation, outside think tank groups — notably the Tax Policy Center and the Tax Foundation — have also developed macrodynamic estimation models. The May 2017 National Tax Association (NTA) Spring Symposium brought together the JCT with the Tax Foundation and the Tax Policy Center for a panel discussion regarding their respective macrodynamic estimating approaches. This paper reports on that discussion.

Below each organization provides a general description of their macrodynamic modeling methodology and answers five questions posed by the convening authors.

http://taxprof.typepad.com/taxprof_blog/2017/11/macroeconomic-modeling-of-tax-policy-a-comparison-of-current-methodologies.html

Scholarship, Tax | Permalink

Comments