Paul L. Caron

Friday, November 21, 2014

CBO: Options for Reducing the Deficit, 2015 to 2024

Congressional Budget Office, Options for Reducing the Deficit: 2015 to 2024:

This document provides estimates of the budgetary savings from 79 options that would decrease federal spending or increase federal revenues over the next decade. 

36 of these 79 options are tax increases:

Individual Income Tax Rates
1.  Increase Individual Income Tax Rates
2.  Implement a New Minimum Tax on Adjusted Gross Income
3.  Raise the Tax Rates on Long-Term Capital Gains and Dividends by 2 Percentage Points

Individual Income Tax Base
4. Use an Alternative Measure of Inflation to Index Some Parameters of the Tax Code
5. Convert the Mortgage Interest Deduction to a 15 Percent Tax Credit
6. Eliminate the Deduction for State and Local Taxes
7. Curtail the Deduction for Charitable Giving
8. Limit the Value of Itemized Deductions.
9. Include Employer-Paid Premiums for Income Replacement Insurance in Employees’ Income
10. Include Investment Income From Life Insurance and Annuities in Taxable Income
11. Tax Carried Interest as Ordinary Income
12. Include All Income That U.S. Citizens Earn Abroad in Taxable Income
13. Tax Social Security and Railroad Retirement Benefits in the Same Way That Distributions From Defined Benefit Pensions Are Taxed
14. Further Limit Annual Contributions to Retirement Plans
15. Eliminate the Tax Exemption for New Qualified Private Activity Bonds

Individual Income Tax Credits
16. Eliminate Certain Tax Preferences for Education Expenses
17. Lower the Investment Income Limit for the Earned Income Tax Credit and Extend That Limit to the Refundable Portion of the Child Tax Credit

Payroll Taxes
18. Increase the Maximum Taxable Earnings for the Social Security Payroll Tax
19. Expand Social Security Coverage to Include Newly Hired State and Local Government Employees
20. Increase the Payroll Tax Rate for Medicare Hospital Insurance by 1 Percentage Point
21. Tax All Pass-Through Business Owners Under SECA and Impose a Material Participation Standard
22. Increase Taxes That Finance the Federal Share of the Unemployment Insurance System

Taxation of Income From Businesses and Other Entities
23. Increase Corporate Income Tax Rates by 1 Percentage Point
24. Repeal the “LIFO” and “Lower of Cost or Market” Inventory Accounting Methods
25. Repeal Certain Tax Preferences for Extractive Industries
26. Extend the Period for Depreciating the Cost of Certain Investments
27. Repeal the Deduction for Domestic Production Activities
28. Repeal the Low-Income Housing Tax Credit

Taxation of Income From Worldwide Business Activity
29. Modify the Rules for the Sourcing of Income From Exports
30. Determine Foreign Tax Credits on a Pooling Basis

Excise Taxes
31. Increase Excise Taxes on Motor Fuels by 35 Cents and Index for Inflation
32. Increase All Taxes on Alcoholic Beverages to $16 per Proof Gallon

Other Taxes and Fees
33. Impose a Tax on Financial Transactions
34. Impose a Fee on Large Financial Institutions
35. Impose a Tax on Emissions of Greenhouse Gases
36. Increase Federal Civilian Employees’ Contributions to Their Pensions

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