Brooks Presents The Sixteenth Amendment And The Meaning Of ‘Income’ Today At Columbia

John Brooks (Fordham; Google Scholar) presents The Sixteenth Amendment and the Meaning of "Income" (with David Gamage (Indiana-Maurer; Google Scholar)) at Columbia today as part of its Davis Polk & Wardwell Tax Policy Colloquium hosted by Michael Love:

The upcoming Supreme Court case of Moore v. United States raises questions that the Court has rarely had to address in the last 100 years—what is the meaning of income under the Sixteenth Amendment, and of the Sixteenth Amendment generally? And furthermore, is realization required before the gain from property ownership can be treated as income? And what does realization mean? The taxpayers in Moore (and the Ninth Circuit judges who dissented from the denial of rehearing en banc) argue that realization is necessarily a part of the meaning of “income” in the Sixteenth Amendment—i.e., that there must be some act of separation or conversion of property into cash or other property in order for there to be “income.” They are, in essence, aiming to revive a disputed reading of the discredited 1920 case of Eisner v. Macomber.

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Kysar Presents The Global Tax Deal And The New International Economic Order Today At NYU

Rebecca Kysar (Fordham; Google Scholar) presents The Global Tax Deal and the New International Economic Order at NYU today as part of its Tax Policy and Public Finance Colloquium hosted by Daniel Shaviro:

The ethos of economic integration and trade liberation no longer reigns supreme. Instead of multilateral trade agreements, nations are turning towards protectionism and unilateralism. Yet in late 2021, nearly 140 countries agreed to a new international tax system that is aimed at levelling the playing field among them, curtailing competition on corporate tax rates and corporate profit shifting to tax havens through a new global minimum tax as well as constructing a new allocation of taxing rights among nations.

Although multilateral trade agreements now seem out of reach, tax multilateralism is ascendant. This is surprising given the deep connection between taxation and national sovereignty. It also perplexing since international tax does not exhibit the same theoretical harmony between national and worldwide welfare that international trade enjoys. The traditional account offered by economists is that trade liberalization is a rising tide that will lift all boats because countries will produce according to their competitive advantages and trade the rest, making trade suitable for international coordination. In contrast, tax is largely described as a zero-sum contest for a fixed pot of tax revenues, deeming it ill-suited for collective action.

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Next Week’s Tax Workshops

Tuesday, September 26: Rebecca Kysar (Fordham; Google Scholar) will present The Global Tax Deal and the New International Economic Order as part of the NYU Tax Policy and Public Finance Colloquium. If you would like to attend, please contact Daniel Shaviro. 

Thursday, September 28:  John Brooks (Fordham; Google Scholar) will present The Sixteenth Amendment and the Meaning of "Income" (with David Gamage (Indiana-Maurer; Google Scholar)) as part of the Columbia Davis Polk & Wardwell Tax Policy Colloquium. If you would like to attend, please contact Michael Love.

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Avi-Yonah Presents Taxing Nomads: Reviving Citizenship-Based Taxation For The 21st Century Today At Boston College

Reuven Avi Yonah (Michigan; Google Scholar) presents Taxing Nomads: Reviving Citizenship-Based Taxation for the 21st Century at Boston College today as part of its Tax Policy Collaborative hosted by James Repetti and Diane Ring.

The COVID pandemic and the rise of zooming has increased the ability of many people (primarily the rich) to work remotely. This in turn has led to more people moving to other countries to benefit from the ability to work remotely while enjoying other benefits such as lower housing prices, a more leisurely lifestyle, and in some cases greater political stability. Many Americans have used their newfound freedom to move overseas, e.g., to Italy. They and others like them are the new nomads.

Such a move is not tax motivated because Italy has higher personal tax rates than the US. It does, however, raise interesting tax issues because the US (uniquely) imposes worldwide taxation on its citizens wherever they live, while Italy (like most countries) does not tax non-resident citizens but taxes its residents on worldwide income regardless of their citizenship status.

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Osofsky Presents Legitimacy And Tax Enforcement Today At Florida

Leigh Osofsky (North Carolina; Google Scholar) presents Legitimacy and Tax Enforcement, 61 Harv. J. on Leg. __ (2024) (with Joshua D. Blank (UC-Irvine; Google Scholar)) at Florida today as part of its Tax Colloquium hosted by Yariv Brauner:

One of the most powerful charges that can be leveled against the IRS is that it is targeting taxpayers. Charges of political targeting have dogged the IRS for over a century, including in major controversies such as the so-called Tea Party auditing scandal in 2013. Commentators and scholars have long-critiqued the IRS for focusing audit resources on some of the lowest-income Americans. And, most recently, a group of researchers estimated that the IRS audits Black taxpayers at a 2.9 to 4.7 times greater rate, as compared to non-Black taxpayers. In response, legislators demanded action, there was widespread public consternation, and IRS officials stated that they were “deeply concerned by these findings.” These, and other, controversies suggest deep disdain for the targeting of taxpayers by the IRS.

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Goldin Presents Measuring And Mitigating Racial Disparities In Tax Audits Today At Columbia

Jacob Goldin (Chicago; Google Scholar) presents Measuring and Mitigating Racial Disparities in Tax Audits (with Hadi Elzayn (Stanford; Google Scholar), Evelyn Smith (Michigan), Thomas Hertz (U.S. Treasury), Arun Ramesh (Chicago), Robin Fisher (U.S. Treasury) & Daniel E. Ho (Stanford)) at Columbia today as part of its Davis Polk & Wardwell Tax Policy Colloquium hosted by Michael Love:

Government agencies around the world use data-driven algorithms to allocate enforcement resources. Even when such algorithms are formally neutral with respect to protected characteristics like race, there is widespread concern that they can disproportionately burden vulnerable groups. We study differences in Internal Revenue Service (IRS) audit rates between Black and non-Black taxpayers. Because neither we nor the IRS observe taxpayer race, we propose and employ a novel partial identification strategy to estimate these differences. Despite race-blind audit selection, we find that Black taxpayers are audited at 2.9 to 4.7 times the rate of non-Black taxpayers. The main source of the disparity is differing audit rates by race among taxpayers claiming the Earned Income Tax Credit (EITC). Using counterfactual audit selection models for EITC claimants, we find that maximizing the detection of underreported taxes would not lead to Black taxpayers being audited at higher rates.

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Newton Presents Closing The Opportunity Gap Today At UC-San Francisco

Deanna Newton (Pepperdine) presents Closing the Opportunity Gap at UC-San Francisco today as part of its Tax Speaker Series hosted by Heather Field:

Opportunity Zones are low-income areas or economically distressed communities in the United States. The Opportunity Zone program encourages investment in low-income areas or economically distressed communities by offering investors tax benefits. Scholars have found little evidence that Opportunity Zones positively impact zone residents’ lives, concluding that Opportunity Zone legislation mostly benefits wealthy investors and should be reformed to benefit community members better. Investors are currently not required to finance projects geared toward the needs of local communities; they are instead funding developments they would have already invested in, whether located in an Opportunity Zone or not. This Article argues that current reform efforts and related scholarship do not give adequate weight to active and direct participation by community members and investors as it relates to economic development tax incentives. It argues for a comprehensive framework that focuses on active, direct, and transformative participation by community members and investors.

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Dean Presents Global Jim Crow: Taxation And Racial Capitalism At Boston University

Steven Dean (Boston University) presents his forthcoming book Global Jim Crow: Taxation And Racial Capitalism (Oxford University Press) at Boston University today as part of its Congresswoman Barbara Jordan Speaker Series on Race, Law, and Inequality (register here):

What makes some nations rich and others poor? Why do even the most powerful states struggle to tax giant multinationals? One answer to both questions lies in a system of Global Jim Crow created as a response to fears over the rise of sovereign African states in the late 1950s and 1960s. For more than half a century, the Organization for Economic Cooperation and Development has shielded multinationals from taxation, doing its job so well that even the wealthiest states lack urgently needed tax revenues. More than six decades into its existence, the OECD has still never had a majority-Black member and continues to exploit anti-Black racism to preserve its power.

Congresswoman Barbara Jordon Speaker Series on Race, Law & Inequality
Despite the laudable ideals expressed by this nation’s founders, US law has routinely been written, enacted, and interpreted by those in power in ways that reinforce, rather than dismantle, racial inequality. In this sense, law has become one part of the structures in which racism is embedded. This structural racism touches upon every area of the law, and nearly 250 years into this democratic experiment that is the United States, people of color have still not gained full and equal membership in US society. 

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Kysar Presents The Global Tax Deal And Its Implications Today At Loyola-L.A.

Rebecca Kysar (Fordham; Google Scholar) presents The Global Tax Deal and Its Implications at Loyola-L.A. today as part of its Tax Policy Colloquium hosted by Katie Pratt and Ted Seto:

The ethos of economic integration and trade liberation no longer reigns supreme. Instead of multilateral trade agreements, nations are turning towards protectionism and unilateralism. Yet in late 2021, nearly 140 countries agreed to a new international tax system that is aimed at levelling the playing field among them, curtailing competition on corporate tax rates and corporate profit shifting to tax havens through a new global minimum tax as well as constructing a new allocation of taxing rights among nations.

Although multilateral trade agreements now seem out of reach, tax multilateralism is ascendant. This is surprising given the deep connection between taxation and national sovereignty. It also perplexing since international tax does not exhibit the same theoretical harmony between national and worldwide welfare that international trade enjoys. The traditional account offered by economists is that trade liberalization is a rising tide that will lift all boats because countries will produce according to their competitive advantages and trade the rest, making trade suitable for international coordination. In contrast, tax is largely described as a zero-sum contest for a fixed pot of tax revenues, deeming it ill-suited for collective action.

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Next Week’s Tax Workshops

Monday, September 18: Deanna  Newton (Pepperdine) will present Opportunity Gap as part of the UC-San Francisco Tax Speaker Series. If you would like to attend, please contact Heather Field.

Monday, September 18: Rebecca Kysar (Fordham; Google Scholar) will present The Global Tax Deal and Its Implications as part of the Loyola-L.A. Tax Policy Colloquium. If you would like to attend, please RSVP here. 

Monday, September 18: Steven Dean (Boston University) will present Global Jim Crow: Taxation and Racial Capitalism (Oxford University Press 2023) as part of the Boston University Congresswoman Barbara Jordan Speaker Series On Race, Law, & Inequality. If you would like to attend, please RSVP here. 

Thursday, September 21: Jacob Goldin (Chicago; Google Scholar) will present Measuring and Mitigating Racial Disparities in Tax Audits  (with Hadi Elzayn (Stanford; Google Scholar), Evelyn Smith (Michigan), Thomas Hertz (U.S. Treasury), Arun Ramesh (Chicago), Robin Fisher (U.S. Treasury) & Daniel Ho (Stanford)) as part of the Columbia Davis Polk & Wardwell Tax Policy Colloquium. If you would like to attend, please contact Michael Love.

Friday, September 22: Reuven Avi Yonah (Michigan; Google Scholar) will present Taxing Nomads: Reviving Citizenship-Based Taxation for the 21st Century as part of the Boston College Tax Policy Collaborative. If you would like to attend, please contact Jim Repetti or Diane Ring. 

Friday, September 22: Leigh Osofsky (North Carolina; Google Scholar) will present Legitimacy and Tax Enforcement, 61 Harv. J. on Leg. __ (2024) (with Joshua D. Blank (UC-Irvine; Google Scholar)) as part of the Florida Tax Colloquium. If you would like to attend, please contact Yariv Brauner. 

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Kim Presents Taxing The Metaverse Today At Columbia

Young Ran (Christine) Kim (Cardozo; Google Scholar) presents Taxing the Metaverse, 112 Geo. L.J. __ (2024) at Columbia today as part of its Davis Polk & Wardwell Tax Policy Colloquium hosted by Michael Love:

The buzz surrounding the Metaverse has been growing steadily for the past couple of years, but the tax implications of this novel ecosystem remain fuzzy to most tax scholars. Such uncertainty is concerning, given the potential and momentum of this emerging technology. Although the Metaverse evolved from online video games focused only on user consumption, it now allows users to produce income and accumulate wealth entirely within the Metaverse. Current law seems to defer taxation of such until a realization or cash-out event. This paper challenges this approach.

This paper offers novel arguments justifying Metaverse taxation. Because economic activity within the Metaverse satisfies the Haig-Simons and Glenshaw Glass definitions of income, its exclusion will create a tax haven. Tax policy can also play an essential role in regulating the virtual economy. Furthermore, this emerging technology allows policymakers to modernize the tax system. 

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Kim Presents Taxing The Metaverse Today At NYU

Young Ran (Christine) Kim (Cardozo; Google Scholar) presents Taxing the Metaverse, 112 Geo. L.J. __ (2024) at NYU today as part of its Tax Policy and Public Finance Colloquium hosted by Daniel Shaviro:

The buzz surrounding the Metaverse has been growing steadily for the past couple of years, but the tax implications of this novel ecosystem remain fuzzy to most tax scholars. Such uncertainty is concerning, given the potential and momentum of this emerging technology. Although the Metaverse evolved from online video games focused only on user consumption, it now allows users to produce income and accumulate wealth entirely within the Metaverse. Current law seems to defer taxation of such until a realization or cash-out event. This paper challenges this approach.

This paper offers novel arguments justifying Metaverse taxation. Because economic activity within the Metaverse satisfies the Haig-Simons and Glenshaw Glass definitions of income, its exclusion will create a tax haven. Tax policy can also play an essential role in regulating the virtual economy. Furthermore, this emerging technology allows policymakers to modernize the tax system. 

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Morse Presents Old Regs Today At UC-San Francisco

Susan Morse (Texas; Google Scholar) presents Old Regs, 31 Geo. Mason L. Rev. __ (2023) at UC-San Francisco today as part of its Tax Speaker Series hosted by Heather Field:

Old regs should not be subject indefinitely to administrative procedure challenge. Instead, we should leave them alone. The consensus case law view applies the six-year limitations period under 28 U.S.C. § 2401(a) with accrual at the time of promulgation. This strikes the right balance between accuracy and repose and correctly reflects that all of the elements of the administrative procedure claim are in place at the time of the alleged error, when the regulation was promulgated. When — as is sometimes true in tax—the government delays a claim through no fault of any plaintiff, equity provides the appropriate judicial solution. '''

Conclusion
The puzzle presented by administrative procedure challenges to old regs amounts to a classic tension in law: the tradeoff between accuracy and repose. The puzzle is solved by the default six-year limitations period of 28 U.S.C. § 2401(a). Applicable case law correctly holds, although without carefully explaining its reasoning, that this period begins to run when a regulation is promulgated for administrative procedure claims. Tax provides a good test case, which is to say a difficult test case, for exploring this issue. It systematically raises issues of pre-litigation delay, intervening case law, and nonenforcement that raise the question of whether exceptions to the six-year limitations period should be made.

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Next Week’s Tax Workshops

Tuesday, September 12: Young Ran (Christine) Kim (Cardozo; Google Scholar) will present Taxing the Metaverse, 112 Geo. L.J. __ (2024) as part of the NYU Tax Policy and Public Finance Colloquium. If you would like to attend, please contact Daniel Shaviro. 

Tuesday, September 12: Susan Morse (Texas; Google Scholar) will present Old Regs, 31 Geo. Mason L. Rev. __ (2023) as part of the UC-San Francisco Tax Speaker Series. If you would like to attend, please contact Heather Field.

Thursday, September 14: Young Ran (Christine) Kim (Cardozo; Google Scholar), will present Taxing the Metaverse, 112 Geo. L.J. __ (2024) as part of the Columbia Davis Polk & Wardwell Tax Policy Colloquium. If you would like to attend, please contact Michael Love.

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Girgis Presents Fragility Not Superiority? Assessing The Fairness Of Special Religious Protections At Pepperdine

Sherif Girgis (Notre Dame) presented Fragility Not Superiority? Assessing the Fairness of Special Religious Protections, 171 U. Pa. L. Rev. 147 (2022), at Pepperdine last Thursday as part of our Nootbaar Institute For Law, Religion, and Ethics’ Law, Faith and Religion Colloquium Series sponsored by the Brenden Mann Foundation and hosted by Michael Helfand and Jennifer Koh:

Is it fair to grant exemptions from neutral laws to protect religion but not other deep commitments and pursuits, like secular conscience or care-giving bonds? The thirty-year scholarly debate on this question now has legal import, as the Supreme Court stands poised to reverse precedent and restore free exercise exemptions from neutral laws. Whether it should, under stare decisis, turns partly on moral considerations like the fairness issue. And the fairness debate is worth revisiting. Almost everyone has assumed that special religious protections are fair only if religion matters more than other interests. Yet protections for religion might be warranted not because religion is more important, but because it is more needful of protection.

To see if these special protections are indeed fair and necessary, this Article develops a measure of need, based on how all civil liberties work in our system. Our doctrines on speech, abortion (for decades), gun rights, and travel have imposed heightened scrutiny on laws that deny us one means of exercising a liberty without leaving adequate alternatives—i.e., other ways to realize the interests served by that liberty to the same degree and at no greater cost. Thus, an interest will have greater need for this protection, the more that laws burdening some means to it will leave no adequate alternative means—or the more “fragile” the interest is. And even if an interest is fragile (because burdens on it are often too heavy), it will not need protection if it rarely faces burdens, heavy or not—if it is not “exposed.” These two concepts create a framework for assessing all our liberties and limiting their scope.

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Hemel Presents The Realization Doctrine And The Optimal Taxation Of Capital Income Today At The OMG Transatlantic Tax Talks

Daniel Hemel (NYU; Google Scholar) presents The Realization Doctrine and the Optimal Taxation of Capital Income (with Dhammika Dharmapala (Chicago; Google Scholar)) at the OMG Transatlantic Tax Talks Series (OMG = Oxford-Michigan-MIT-Munich-Georgetown) today: 

The realization requirement—a common feature of real-world capital income tax systems—defers the taxation of gains until the sale or other disposition of assets. As implemented, it generally imposes effective capital income tax rates that decline over a taxpayer’s holding period. Scholars of tax law and public finance have long appreciated that the realization requirement generates a deferral benefit and an associated allocative inefficiency (the “lock-in effect”). However, they have largely overlooked the relationship between realization and the optimal taxation of capital over the lifecycle. In this paper, we connect the realization requirement to canonical results in the optimal tax literature—in particular, the Atkinson-Stiglitz argument for the nontaxation of retirement savings and the Diamond-Mirrlees argument for high tax rates on savings withdrawn in midlife. First, we reconcile these results in a simple three-period framework with stochastic skill shocks in the middle period, demonstrating that the optimal tax rate on savings withdrawn in the middle period is high while the optimal tax rate on savings withdrawn in the final period is zero. We next show how the realization requirement partially implements the optimal age-dependent capital income tax schedule. 

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Next Week’s Tax Workshop

Thursday, May 18: Daniel Hemel (NYU; Google Scholar) will present The Realization Doctrine and the Optimal Taxation of Capital Income (with Dhammika Dharmapala (Chicago; Google Scholar)) as part of the OMG Transatlantic Tax Talks:

The realization requirement—a common feature of real-world capital income tax systems—defers the taxation of gains until the sale or other disposition of assets. As implemented, it generally imposes effective capital income tax rates that decline over a taxpayer’s holding period. Scholars of tax law and public finance have long appreciated that the realization requirement generates a deferral benefit and an associated allocative inefficiency (the “lock-in effect”). However, they have largely overlooked the relationship between realization and the optimal taxation of capital over the lifecycle. In this paper, we connect the realization requirement to canonical results in the optimal tax literature—in particular, the Atkinson-Stiglitz argument for the nontaxation of retirement savings and the Diamond-Mirrlees argument for high tax rates on savings withdrawn in midlife.

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Lipman Presents Not Taxing Puerto Rico? Whitewashing Impoverishment In U.S. vs Vaello Madero Today At Georgetown

Francine J. Lipman (UNLV; Google Scholar) presents Not Taxing Puerto Rico? Whitewashing Impoverishment in United States v. Vaello-Madero at Georgetown today as part of its Tax Law and Public Finance Workshop hosted by Emily Satterthwaite and Dayanand Manoli:

For more than four generations, since 1917, Puerto Ricans have qualified for U.S. citizenship. Yet citizens residing in Puerto Rico do not enjoy the same rights and privileges of citizens residing in the states and Washington D.C., but rather must suffer what Justice Ruth Bader Ginsburg famously coined, albeit in the context of marriage, a “skim milk” version of citizenship. This disparate treatment arises from the Supreme Court’s interpretation of the Territory Clause of the Constitution in the Insular Cases. The Territory Clause provides Congress with plenary power to “dispose of and make all needful Rules and Regulations respecting the Territory.” The Supreme Court through its decisions in the Insular Cases, dated more than one-hundred years ago, and their progeny has generally held that the Constitution only applies to residents of the territories if Congress has specifically ruled that it applies and if the right is “fundamental.”

To be clear, many have criticized the Insular Cases. Most recently Justice Gorsuch, in his concurrence in Vaello-Madero, has described the Insular Cases as a “misguided framework” with a “rotten foundation” arising from the “sordid business of segregating Territories and the people who live in them on the basis of race, ethnicity, or religion” relying on “ugly racial stereotypes, and the theories of social Darwinists.” 

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Stark Presents Kneecapping Prop 13 Through The Income Tax Today At San Diego

Kirk J. Stark (UCLA) presents Kneecapping Prop 13 Through The Income Tax at San Diego today as part of its Tax Speaker Series hosted by Miranda Fleischer:

Under constitutional limitations on California’s local property tax introduced via Proposition 13 in June 1978, homeowners are generally taxed not on the fair market value of their homes but rather the property’s historic cost. As home prices rise over time, this “acquisition value” feature has two predictable effects: (1) it results in significant property tax disparities, favoring longtime homeowners relative to more recent purchasers, and (2) it discourages homeowners from moving because of the increased property tax burdens associated with purchasing a new home. Less widely recognized is the offsetting effect of a longstanding feature of California’s income tax: the deduction for local property taxes. By directing a larger subsidy to those with higher property taxes, this provision favors recent homebuyers facing market-value property taxes relative to longtime owners with constitutionally limited assessed valuations. 

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Next Week’s Tax Workshops

Tuesday, April 25: Kirk J. Stark (UCLA) will present Kneecapping Prop 13 Through The Income Tax as part of the San Diego Tax Speaker Series. If you would like to attend, please contact Miranda Fleischer.

Tuesday, April 25: Francine J. Lipman (UNLV; Google Scholar) will present Not Taxing Puerto Rico? Whitewashing Impoverishment in United States v. Vaello-Madero as part of the Georgetown Tax Law and Public Finance Workshop. If you would like to attend, please contact Emily Satterthwaite and Dayanand Manoli.

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Newton Presents Closing the Opportunity Gap Today At Boston College

Deanna Newton (Pepperdine) presents Closing the Opportunity Gap at Boston College today as part of its Tax Policy Collaborative hosted by James Repetti:

Researchers have found little to no evidence that Opportunity Zones positively impact zone residents’ lives. Scholars agree that the majority of benefits from Opportunity Zone legislation go to wealthy investors and should be reformed to better benefit community members. This Article argues that current reform efforts and related scholarship do not give adequate weight to active and direct participation by community members and investors. This Article proposes two novel policy reforms for the Opportunity Zone program, which fills a growing gap in Opportunity Zone literature. First, investors should be required to buy into the community financially or personally. Buy-in would entail a one-time lump sum payment to a community fund or a community service pledge to ensure actualized commitment to community development. Second, a percentage of each Opportunity Zone should be reserved for current community members to invest in. Investors are currently not required to finance projects geared toward the needs of local communities, and are instead funding developments they would have already invested in, whether located in an Opportunity Zone or not.

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Dean Presents Surrey's Silence: Subpart F And The Swiss Subsidiary Tax That Never Was At The OMG Transatlantic Tax Talks And Princeton

Steven Dean (Brooklyn; moving to Boston University) presents Surrey's Silence: Subpart F and the Swiss Subsidiary Tax that Never Was, 87 Law & Contemp. Probs. __ (2024), at the OMG Transatlantic Tax Talks Series (OMG = Oxford-Michigan-MIT-Munich-Georgetown) today and at Princeton tomorrow as part of its Symposium on Law, Identity, and Economic Development in the Post-Colonial Era: The Case of the Northern Atlantic and Larger Caribbean Regions:

Was Stanley Surrey racist? Was he a coward for not speaking as plainly about the Swiss tax haven problem in public as the Surrey Papers reveal his team did in private? In the broad sweep of history Surrey’s silence may have mattered a great deal or it may have mattered very little. The quiet aspect of the Liberia problem that it highlights undoubtedly does. Exploiting the public’s misunderstanding of the term tax haven as Surrey quickly learned to do has become second nature to scholars and policymakers alike. No less powerful than the loud aspect of the Liberia problem, the dog whistle politics it embodies demean all those who harness it by railing against tax havens just as it does those who decry “welfare cheats or illegal aliens.”

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Hardy Presents Black-White And Rural-Urban Income Inequality Today At Georgetown

Bradley Hardy (Georgetown; Google Scholar) presents Stalled Progress? Five Decades of Black-White and Rural-Urban Income Gaps (with Shria Holla (B.S. 2024, Kentucky), Elizabeth Krause (PhD 2026, Kentucky) & James P. Ziliak (Kentucky; Google Scholar)), at Georgetown today as part of its Tax Law and Public Finance Workshop hosted by Emily Satterthwaite and Dayanand Manoli:

Black-White income inequality in the U.S. has persisted for generations (Smith and Welch 1989; Bayer and Charles 2018). While much less studied, similar group-level differences have also persisted across the rural-urban divide in the U.S. (Lichter and Ziliak 2017). These differences include yawning gaps in education attainment, access to capital, and opportunities for upward economic mobility, among others. Much of the extant literature among economists has focused on labor-market outcomes of employment, wages, and earnings, especially among Black and White men. However, because many aspects of the U.S. tax and transfer system are targeted to lower-income households, it is possible that the redistributive features of the social safety net have improved the distribution of after-tax and transfer income of Black and rural households relative to White and urban households, respectively. To investigate these trends, we assemble five decades of data from the 1976-2022 Current Population Survey Annual Social and Economic Supplement (CPS ASEC) to make a comparative assessment of after-tax and transfer Black-White and rural-urban household income gaps, accounting for redistributive tax and transfer programs. 

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Lim Presents Business Owners' Response To The 199A Qualified Business Income Deduction Today At Columbia

Katherine Lim (U.S. Department of Agriculture, Economic Research Service; Google Scholar) presents How Do Business Owners Respond to a Tax Cut? Examining the 199A Deduction for Pass-through Firms (with Lucas Goodman (U.S. Treasury Department, Office of Tax Analysis), Bruce Sacerdote (Dartmouth; Google Scholar) & Andrew Whitten (U.S. Treasury Department, Office of Tax Analysis; Google Scholar)) at Columbia today as part of its Davis Polk & Wardwell Tax Policy Colloquium hosted by David Schizer:

We measure the short-run responses of businesses and their owners to Section 199A, a deduction that reduced the effective tax rate on most U.S. pass-through business income beginning in 2018. We study taxpayer behavior using de-identified tax records of individuals and businesses. With some notable exceptions, we find neither strong evidence of tax avoidance behavior nor evidence of positive real economic effects. We do not find an increase in 2018 or 2019 business income eligible for the deduction, either in the time series or from comparisons of taxpayers with exogenously differing levels of exposure to the deduction. We examine specific hypothesized margins of adjustment. Partnerships reduce compensation paid to owners, in line with the incentives created by 199A, but S corporations do not. In contrast to fears expressed about the legislation, we do not find that workers—whether new hires or current employees—switch from employee to contractor status to claim the new deduction. 

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Next Week’s Tax Workshops

Tuesday, April 18: Katherine Lim (U.S. Department of Agriculture, Economic Research Service; Google Scholar) will present How Do Business Owners Respond to a Tax Cut? Examining the 199A Deduction for Pass-through Firms (with Lucas Goodman (U.S. Treasury Department, Office of Tax Analysis), Bruce Sacerdote (Dartmouth; Google Scholar) & Andrew Whitten (U.S. Treasury Department, Office of Tax Analysis; Google Scholar)) as part of the Columbia Davis Polk & Wardwell Tax Policy Colloquium. If you would like to attend, please contact David Schizer. 

Tuesday, April 18: Bradley Hardy (Georgetown; Google Scholar) will present Stalled Progress? Five Decades of Black-White and Rural-Urban Income Gaps as part of the Georgetown Tax Law and Public Finance Workshop. If you would like to attend, please contact Emily Satterthwaite and Dayanand Manoli.

Thursday, April 20: Steven Dean (Brooklyn) will present Surrey's Silence: Subpart F and the Swiss Subsidiary Tax that Never Was, 87 Law & Contemp. Probs. __ (2024), as part of the OMG Transatlantic Tax Talks. No registration is required for this event.

Friday, April 21: Deanna Newton (Pepperdine) will present Closing the Opportunity Gap as part of the Boston College Tax Policy Collaborative. If you would like to attend, please contact James Repetti.

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Hayashi Presents Tax Law Reinforcement And Redistributive Politics Today At Duke

Andrew Hayashi (Virginia; Google Scholar) presents Tax Law Reinforcement and Redistributive Politics (with Yehonatan Givati (Hebrew University)) at Duke today as part of its Tax Policy Seminar hosted by Lawrence Zelenak:

The Inflation Reduction Act signed by President Biden on August 16, 2022, allocated $80 billion in additional funding for the IRS. While Democrats unanimously supported the bill, not a single Republican voted in favor of it. And the first legislation advanced by the new Republican majority this year was to repeal this increase in IRS funding. Given the state of IRS enforcement and funding, increasing the resources devoted to tax enforcement seems like an obvious imperative without a clear partisan valence. One might think that political and ideological battles would be fought over what the tax law is, not whether the IRS has the resources to enforce it. But IRS funding has become a major political point of contention. Why is tax law enforcement such a partisan issue?

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Kim Presents Taxing The Metaverse At Michigan State

Young Ran (Christine) Kim (Cardozo; Google Scholar) presented Taxing the Metaverse, 116 Geo. L.J. __ (2023), at Michigan State on Monday as part of its Faculty Programs & Workshops:

The buzz surrounding the Metaverse has been growing steadily for the past couple of years, but the tax implications of this novel ecosystem remain fuzzy to most tax scholars. Such uncertainty is concerning, given the potential and momentum of this emerging technology. Although the Metaverse evolved from online video games focused only on user consumption, it now allows users to produce income and accumulate wealth entirely within the Metaverse. Current law seems to defer taxation of such until a realization or cash-out event. This paper challenges this approach.

This paper offers novel arguments justifying Metaverse taxation. Because economic activity within the Metaverse satisfies the Haig-Simons and Glenshaw Glass definitions of income, its exclusion will create a tax haven. Tax policy can also play an essential role in regulating the virtual economy. 

Continue reading

Gondwe Presents The Life-Saving Potential Of Direct Public Financial Assistance To Survivors Of Intimate Partner Violence Today At UC-San Francisco

Nyamagaga Gondwe (Wisconsin; Google Scholar) presents Emergency Exit: The Life-Saving Potential of Direct Public Financial Assistance to Survivors of Intimate Partner Violence at UC-San Francisco today as part of its Tax Policy Colloquium hosted by Manoj Viswanathan: 

Intimate partner violence (IPV) is viewed primarily as a class of criminal behavior in federal policy. But the criminal justice system operates through a model of individual accountability, which means that solutions to IPV in American communities focus on education (proactive) and incarceration (reactive) as interventions.

However, public health studies on IPV suggest that the kinds of physical violence that result in arrest should not be seen as the central issue in addressing IPV. Instead, those studies suggest that physical violence should be thought of as a tool for one partner in a relationship to exert coercive power and control over the other partner. Put another way, physical violence is just one of multiple tools an abuser will use to control their partner. Other tools include emotional abuse, psychological abuse, and economic abuse.

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Next Week’s Tax Workshops

Tuesday, April 11: Nyamagaga Gondwe (Wisconsin; Google Scholar) will present Emergency Exit: The Life-Saving Potential of Direct Public Financial Assistance to Survivors of Intimate Partner Violence as part of the UC-San Francisco Tax Policy Colloquium. If you would like to attend, please contact Manoj Viswanathan.

Tuesday, April 11: Sarah Reber (Brookings Institute; Google Scholar) will present Funding High-Poverty School Districts: Federal Policy Tools and the Limits of Incentives as part of the Georgetown Tax Law and Public Finance Workshop. If you would like to attend, please contact Emily Satterthwaite and Dayanand Manoli.

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Shaviro Presents 'Moralist' Versus 'Scientist': Stanley Surrey And The Public Intellectual Practice Of Tax Policy Today At Duke

Daniel Shaviro (NYU; Google Scholar) presents 'Moralist' Versus 'Scientist': Stanley Surrey and the Public Intellectual Practice of Tax Policy at Duke today as part of its Tax Policy Seminar hosted by Lawrence Zelenak: 

Nearly forty years after his untimely death, Stanley Surrey, the renowned Harvard law professor (and Treasury official), remains perhaps the most important and influential tax law scholar in American history. The recent publication of his highly illuminating memoirs offers a convenient occasion for reassessing his work.

In offering such a reassessment, this essay takes its title from William F. Buckley’s 1974 observation that, while Surrey claimed to analyze tax policy issues with “scientific detachment,” in fact he was a tax “moralist,” whose policy recommendations were “based on a highly articulated set of personal value principles.” 

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Brauner Presents Taxation Of Information And The Data Revolution Today At Florida

Yariv Brauner (Florida; Google Scholar) presents Taxation of Information and the Data Revolution at Florida today as part of a celebration of his academic contribution and appointment to the Hugh Culverhouse Eminent Scholar Chair in Taxation hosted by Charlene Luke:

One cannot escape the data revolution; it is all around us. Advancements in information collection, collation, and analysis are fundamentally altering our world. They are transforming the economy, society, and even ourselves. These dramatic, fast-paced changes place demands on the law and even challenge the role of law in society, resulting in a thriving academic debate. Tax scholarship has yet to join this discourse. This article begins to fill the void, explaining the impediment and exploring realistic policy options.

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Zelenak Presents Designing A Billionaires' Tax Today At Northwestern

Lawrence Zelenak (Duke; Google Scholar) presents two papers on Income Taxation of the Unrealized Gains of the Ultrarich: The 1920s, Stanley Surrey’s Era, and Today at Northwestern today as part of its Advanced Topics in Taxation Colloquium hosted by Gregg Polsky:

1924, 2021: Taxes of the Ultrarich, and Mark-to-Market Reforms, 172 Tax Notes Fed. 583 (July 26, 2021):

In this article, Zelenak tells the story of Treasury’s disclosures of the income tax payments of plutocrats almost a century ago, which mirror the recent ProPublica revelations of the income tax payments of the 25 richest Americans, and he explores why those earlier disclosures — unlike the recent ones — didn’t spark interest in mark-to-market taxation of the ultrarich.

Stanley Surrey and Taxing Unrealized Appreciation, 87 Law & Contemp. Probs. __ (2024): 

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Hayashi Presents Tax Law Reinforcement And Redistributive Politics Today At Toronto

Andrew Hayashi (Virginia; Google Scholar) presents Tax Law Reinforcement and Redistributive Politics (with Yehonatan Givati (Hebrew University)) at Toronto today as part of its James Hausman Tax Law and Policy Workshop Series hosted by Benjamin Alarie:

The Inflation Reduction Act signed by President Biden on August 16, 2022, allocated $80 billion in additional funding for the IRS. While Democrats unanimously supported the bill, not a single Republican voted in favor of it. And the first legislation advanced by the new Republican majority this year was to repeal this increase in IRS funding. Given the state of IRS enforcement and funding, increasing the resources devoted to tax enforcement seems like an obvious imperative without a clear partisan valence. One might think that political and ideological battles would be fought over what the tax law is, not whether the IRS has the resources to enforce it. But IRS funding has become a major political point of contention. Why is tax law enforcement such a partisan issue?

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Güçeri Presents Tax Policy, Investment And Profit-Shifting Today At Columbia

İrem Güçeri (Oxford; Google Scholar) presents Tax Policy, Investment and Profit-Shifting (with Katarzyna Bilicka (Utah State; Google Scholar) & Michael Devereux (Oxford; Google Scholar)) at Columbia today as part of its Davis Polk & Wardwell Tax Policy Colloquium hosted by David Schizer. 

Multinational firms (MNEs) often pay no tax in high-tax countries because they shift a large fraction of their taxable income to tax havens. We build a model of tax policy and investment that incorporates unobserved heterogeneity in MNEs’ profit-shifting capability and different costs of setting up a tax minimization network. The model matches the distribution of taxable profit and investment in detailed UK tax returns data. We use the model to quantify the policy tradeoff between raising tax revenue by combating tax avoidance (via, for example, a Global Minimum Tax) and attracting investment. The results solve a longstanding puzzle in the existing profit-shifting literature: our model reconciles the differences between previous micro- and macro-level estimates of profit-shifting elasticities by accounting for extensive margin decisions (to report positive or no taxable profit in a jurisdiction). We test the model’s predictions using a reform in Italy that limited the profit-shifting activities of Italian MNEs as a quasi-natural experiment.

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Lin Presents Who’s On (The 1040) First? Determinants And Consequences Of Spouses’ Name Order On Joint Returns Today At Georgetown

Emily Lin (Office of Tax Analysis, U.S. Treasury Department) presents Who’s On (the 1040) First? Determinants and Consequences of Spouses’ Name Order on Joint Returns (with Joel Slemrod (Michigan; Google Scholar), Evelyn Smith (Michigan) & Alexander Yuskavage (Office of Tax Analysis, U.S. Treasury Department)) at Georgetown today as part of its Tax Law and Public Finance Workshop hosted by Emily Satterthwaite and Dayanand Manoli: 

Married couples filing a joint return put the male name first 88.1% of the time in tax year 2020, down from 97.3% in 1996. The man’s name is more likely to go first the larger is the fraction of the couple’s allocable income that goes to him, and the older is the couple. Based on state averages, putting the man’s name first is strongly associated with conservative religious attitudes, religiosity, and a survey-based measure of sexist attitudes. Risk-taking and tax noncompliance are both associated with the man’s name going first.

Conclusion
Married couples filing a joint return in the US must choose one of the spouse’s names to be listed first on the tax return. The wording that accompanies the Form 1040 and its instructions implies, but in no way requires or even suggests, that the name of the person doing the couple’s taxes should be listed first. The fact that this decision has absolutely no effect on tax liability might lead one to believe that the name order decision is made causally and, perhaps, randomly. 

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Next Week’s Tax Workshops

Tuesday, April 4: İrem Güçeri (Oxford; Google Scholar) will present Tax Policy, Investment and Profit-Shifting (with Katarzyna Bilicka (Utah State; Google Scholar) & Michael Devereux (Oxford; Google Scholar)) as part of the Columbia Davis Polk & Wardwell Tax Policy Colloquium. If you would like to attend, please contact David Schizer. 

Tuesday, April 4: Emily Lin (Office of Tax Analysis, U.S. Treasury Department) will present Who’s On (the 1040) First? Determinants and Consequences of Spouses’ Name Order on Joint Returns (with Joel Slemrod (Michigan; Google Scholar), Evelyn Smith (Michigan) & Alexander Yuskavage (Office of Tax Analysis, U.S. Treasury Department)) as part of the Georgetown Tax Law and Public Finance Workshop. If you would like to attend, please contact Emily Satterthwaite and Dayanand Manoli.

Wednesday, April 5: Lawrence Zelenak (Duke; Google Scholar) will present two papers on Income Taxation of the Unrealized Gains of the Ultrarich: The 1920s, Stanley Surrey’s Era, and Today as part of the Northwestern Advanced Topics in Taxation Colloquium. If you would like to attend, please contact Gregg Polsky.

• 1924, 2021: Taxes of the Ultrarich, and Mark-to-Market Reforms, 172 Tax Notes Fed. 583 (July 26, 2021)
• Stanley Surrey and Taxing Unrealized Appreciation, 87 Law & Contemp. Probs. __ (2024)

Wednesday, April 5: Andrew Hayashi (Virginia; Google Scholar) will present Tax Law Reinforcement and Redistributive Politics (with Yehonatan Givati (Hebrew University)) as part of the Toronto James Hausman Tax Law and Policy Workshop Series. If you would like to attend, please contact Benjamin Alarie. 

Thursday, April 6: Daniel Shaviro (NYU; Google Scholar) will present 'Moralist' Versus 'Scientist': Stanley Surrey and the Public Intellectual Practice of Tax Policy as part of the Duke Tax Policy Seminar. If you would like to attend, please contact Lawrence Zelenak. 

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Lederman Presents The Rise And Fall (?) Of Luxembourg As A Tax Rulings Haven Today At Duke

Leandra Lederman (Indiana-Maurer; Google Scholar) presents The Rise And Fall (?) Of Luxembourg As A Tax Rulings Haven at Duke today as part of its Tax Policy Seminar hosted by Lawrence Zelenak:

In November 2014, the International Consortium of Investigative Journalists (ICIJ) broke the “LuxLeaks” scandal, revealing hundreds of billions of dollars of secret deals given by the tiny country of Luxembourg to large multinational enterprises such as Amazon, Apple, and Verizon. These sweetheart deals, in the form of Luxembourg tax rulings, allowed many name-brand companies to dodge huge amounts of tax that would otherwise be due to the U.S. or other countries. The international LuxLeaks scandal was headline news because it revealed that large multinationals had essentially bought tax breaks without the knowledge of the countries that would have collected the taxes dodged.

The tax rulings that Luxembourg used to grant these tax breaks were lengthy and complex. It is surprising that a small tax administration was able to produce thousands of these rulings in a few years. This Article is the first to explore the history of where Luxembourg’s informal tax-rulings process came from and the elements that allowed it to be so prolific. 

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Duff Presents Abusive Tax Avoidance And The General-Anti Avoidance Rule Today At Toronto

David Duff (UBC) presents Abusive Tax Avoidance and the Future of the General-Anti Avoidance Rule at Toronto today as part of its James Hausman Tax Law and Policy Workshop Series hosted by Benjamin Alarie:

Canada enacted a statutory general-anti avoidance rule (GAAR) in 1988 in order to limit the scope of the traditional Duke of Westminster principle that taxpayers are entitled to rely on tax-motivated legal arrangements to avoid tax laws that might otherwise apply. After over 30 years of experience with the GAAR and more than 20 years of GAAR jurisprudence, the federal government released a Consultation Paper in August 2022, considering various amendments to “modernize” and “strengthen” the GAAR. This presentation is based on Professor Duff’s response to the GAAR Consultation, as well as a more conceptual article on the rationale for and appropriate design of general anti-avoidance rules that was published in 2020. 

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Sarkar Presents Internal Revenue’s External Borders Today At Georgetown

Shayak Sarkar (UC-Davis; Google Scholar) presents Internal Revenue’s External Borders at Georgetown today as part of its Tax Law and Public Finance Workshop hosted by Emily Satterthwaite and Dayanand Manoli:

The mandate of tax agencies seems clear: to secure revenue for the government and ensure taxpayer compliance. Yet for decades, tax agencies have regularly facilitated immigration enforcement. While scholars and the public have paid significant attention to the use of state and local police for immigration enforcement, this conscription of the taxman as a foot soldier has largely been overlooked.

This paper aims to correct that oversight. Building on the emerging critiques of the tax system’s role in perpetuating racial inequities, I first describe tax-agency participation in immigration raids, holding the dry mechanics of the agency procedures against stark examples of IRS complicity in mid-raid civil rights violations. I then address several reasons to be concerned about tax-agency involvement in immigration enforcement before considering existing constraints on that involvement. My review of those constraints begins with a reminder of the tax-law origins of immigration raids’ constitutional exceptionalism, before assessing the residual constraints on agency participation: taxpayer privacy, regulatory suppression, and civil rights torts.

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Teo Presents The United Nations In Global Tax Coordination Today At British Columbia

Nikki J. Teo (University of Sydney) presents A False Start in International Tax Coordination: The Ghost of the UN’s Past today at Allard School of Law, University of British Columbia hosted by Wei Cui (email here to attend virtually over Zoom at 6:30 PM ET): 

This talk unveils the missing history of the UN’s first attempt at international tax coordination through its Fiscal Commission (1946–1954). It dispels the prevailing myths surrounding the work of that body and reveals the heated struggles by developing countries and the UN Secretariat to negotiate and formulate more equitable international tax principles for application between developed and developing countries. This vital saga sheds light on the role of politics in shaping the international tax regime and offers insights into pressing debates about inclusiveness and multilateralism in international tax norm-setting.

The United Nations in Global Tax Coordination: Hidden History and Politics (Cambridge University Press March 2023):

The United Nations in Global Tax Coordination fills the decade-long knowledge gap in international tax history concerning the UN Fiscal Commission, which functioned as the overarching fiscal authority during the early post-World War II economic order. With insights from political economy and international relations scholarship, this critical archival examination chronicles the tenacious activism by post-colonial developing countries to preserve source taxation rights, and by the UN Secretariat in championing the development of equitable tax rules. Such activism would ultimately lead developed countries to oust the UN as a forum for international tax norm setting.

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Next Week’s Tax Workshops

Tuesday, March 28: Thomas J. Brennan (Harvard) will present Protean Capital Income Taxes (with Robert L. McDonald (Northwestern-Kellogg; Google Scholar)) as part of the Columbia Davis Polk & Wardwell Tax Policy Colloquium. If you would like to attend, please contact David Schizer. 

Tuesday, March 28: Shayak Sarkar (UC-Davis; Google Scholar) will present Internal Revenue’s External Borders as part of the Georgetown Tax Law and Public Finance Workshop. If you would like to attend, please contact Emily Satterthwaite and Dayanand Manoli.

Wednesday March 29: David Duff (Toronto) will present a paper as part of the Toronto James Hausman Tax Law and Policy Workshop Series. If you would like to attend, please contact Benjamin Alarie. 

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Pistone Presents The Implications Of Pillar II (Globe) For Developing Countries Today At Boston College

Pasquale Pistone (Visiting Professor, NYU; Academic Chairman, IBFD (The Netherlands); Professor of Tax Law, University of Salerno (Italy); Jean Monnet ad Personam Chair in European Tax Law & Policy, WU Vienna (Austria); Google Scholar) presents The Implications of Pillar II (Globe) for Developing Countries at Boston College today as part of its Tax Policy Workshops hosted by Jim Repetti: 

The desirable global tax governance goal of preventing the race to the bottom should not justify the bias that the Pillar II version of GloBE might in some cases to produce in favour of domestic over foreign investment. By neutralizing tax incentives in cross-border, but not in domestic situations, the GloBE top-up tax (IIR) puts developing countries, which mostly rely on foreign capital, at a systematic disadvantage when their tax incentives reduce corporation taxes below the global corporate minimum rate. This hidden collateral effect of GloBE might undermine the right of such countries to remain the masters of their international tax policy decisions and pursue their economic development without external interferences. For such reason, it might be questioned from the perspective of fairness and legitimacy. 

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Stark Presents Retrofitting Prop 13 Through The Personal Income Tax Today At Duke

Kirk J. Stark (UCLA) presents Retrofitting Prop 13 Through the Personal Income Tax at Duke today as part of its Tax Policy Seminar hosted by Lawrence Zelenak:

Under constitutional limitations on California’s local property tax introduced via Proposition 13 in June 1978, homeowners are generally taxed not on the fair market value of their homes but rather the property’s historic cost. As home prices rise over time, this “acquisition value” feature has two predictable effects: (1) it results in significant property tax disparities, favoring longtime homeowners relative to more recent purchasers, and (2) it discourages homeowners from moving because of the increased property tax burdens associated with purchasing a new home. Less widely recognized is the offsetting effect of a longstanding feature of California’s income tax: the deduction for local property taxes. By directing a larger subsidy to those with higher property taxes, this provision favors recent homebuyers facing market-value property taxes relative to longtime owners with constitutionally limited assessed valuations. It also mitigates to some degree Prop 13’s lock-in effect by reducing the effective property tax rate for those who purchase new homes.

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Lawsky Presents Coding The Code: Catala And Computationally Accessible Tax Law Today At Toronto

Sarah B. Lawsky (Northwestern; Google Scholar) presents Coding the Code: Catala and Computationally Accessible Tax Law, 75 S.M.U. L. Rev. 535 (2022), at Toronto today as part of its James Hausman Tax Law and Policy Workshop Series hosted by Benjamin Alarie:

This Article describes a new programming language, Catala, created by a team of computer scientists and lawyers. Catala provides a tractable and functional approach to coding U.S. tax law that offers a more transparent formalization and could potentially hold the government more accountable than the current patchwork of forms, worksheets, and secret programs.

While this Article describes a particular programming language, key characteristics of this particular language could generalize to other programming languages that formalize the law. First, Catala is a domain-specific programming language designed specifically for formalizing tax law. In particular, Catala is structured using default logic, a nonstandard logic that represents the underlying structure of the U.S. tax code more accurately than does standard logic. This structure makes the computer code easier to read, easier to create, and easier to modify when the law changes. Second, computer code is created in Catala using a well-known approach in the field of computer science (though rarely mentioned in legal literature) called “pair programming,” which, in this implementation, takes advantage of the knowledge of both lawyers and computer coders. 

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Wallace Presents Taxing Luxury Emissions Today At UC-San Francisco

Clinton G. Wallace (South Carolina; Google Scholar) presents Taxing Luxury Emissions, 106 Cornell L. Rev. __ (2023) (with Shelley Welton (Penn)) (reviewed by Tracey Roberts (Cumberland; Google Scholar) here) at UC-San Francisco today as part of its Tax Policy Colloquium hosted by Manoj Viswanathan:

A host of recent economic and sociological studies have documented the rising challenge of carbon inequality — that is, extreme class disparities in carbon emissions both within the United States and globally. These studies show an alarming divide, with the top 10% of emitters producing half of all emissions and the top 1% alone producing 17% of emissions, while the bottom 50% of the world produces only 10%. These disparities are driven by “luxury emissions” produced by the carbon-intensive lifestyles of the rich, which too often include private jets, mega-SUVs, yachts, and multiple mansions.

Climate change law has been slow to react to the reality of carbon emissions inequality — even as public and media outrage has mounted. Perhaps discouraged by decades of slow progress on both wealth redistribution and carbon consumption policy, policymakers and legal scholars have yet to put forward any serious proposals for how the law might, or should, account for class-based emissions disparities.

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Taite Presents Welfare v Wealthfare: The Illusion Of Equity In Tax Policy Today At Georgetown

Phyllis Taite (Oklahoma City) presents Welfare v Wealthfare: The Illusion of Equity in Tax Policy at Georgetown today as part of its Tax Law and Public Finance Workshop hosted by Emily Satterthwaite and Dayanand Manoli: 

Tax laws and policies may be perceived as race-neutral because race data is not used to determine tax liability. Similarly, the rate structure may be perceived as progressive because tax rates increase as income increases. Nonetheless, history has demonstrated that tax laws and policies are biased against race and class and the tax system is not effectively progressive. This article explores a few ways that perceptions of tax policy do not match the reality of tax laws and policy. 

This article will discuss how transfer taxes were implemented permanently to raise revenue and combat wealth concentration. Instead, the federal transfer tax system is no longer effective for either purpose, though both are essential to effectively addressing vast economic inequalities. Through various tax acts, tax policy has subsidized the wealthy, people who need no financial assistance, rather than combat wealth concentration.

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Schizer Presents How Energy Policy Can Protect Both National Security And The Environment Today At San Diego

David M. Schizer (Columbia) presents Red White and Blue – and also Green: How Energy Policy Can Protect Both National Security and the Environment at San Diego today as part of its Tax Law Speaker Series.

Too often, energy policy protects the environment while neglecting national security, or vice versa. Since each goal is critical, this Article shows to how to advance both at the same time.

For national security, the key is to avoid depending on the wrong suppliers. If they are vulnerable to attack (like some Middle Eastern producers), they need to be defended. Or if they are themselves geopolitical threats (like Russia and Iran), their energy exports fund harmful conduct. This Article breaks new ground in showing why suppliers tend to be insecure or menacing: authoritarian regimes have a comparative advantage in producing oil and gas, since they are less responsive to opposition from environmentalists, local residents, and other groups.

To avoid depending on the wrong suppliers, the U.S. and its allies should pursue two strategies. First, they should cut demand for fossil fuel. Along with making it easier to stop buying from the wrong suppliers, slashing demand also reduces greenhouse gas emissions and pollution.

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Next Week’s Tax Workshops

Monday, March 20: David M. Schizer (Columbia) will present Red White and Blue – and also Green: How Energy Policy Can Protect Both National Security and the Environment as part of the San Diego Tax Law Speaker Series. 

Tuesday, March 21: Clinton G. Wallace (South Carolina; Google Scholar) will present Taxing Luxury Emissions (with Shelley Welton (Penn)) as part of the UC-San Francisco Law Tax Policy Colloquium. If you would like to attend, please contact Manoj Viswanathan. 

Tuesday, March 21: Phyllis Taite (Oklahoma City) will present Welfare v Wealthfare: The Illusion of Equity in Tax Policy as part of the Georgetown Tax Law and Public Finance Workshop. If you would like to attend, please contact Emily Satterthwaite and Dayanand Manoli.

Wednesday, March 22: Sarah B. Lawsky (Northwestern; Google Scholar) will present Coding the Code: Catala and Computationally Accessible Tax Law, 75 S.M.U. L. Rev. 535 (2022) as part of the Toronto James Hausman Tax Law and Policy Workshop Series. If you would like to attend, please contact Benjamin Alarie.

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Kleiman Presents Subjective Costs Of Tax Compliance Today At The OMG Transatlantic Tax Talks

Ariel Jurow Kleiman (Loyola-L.A.; Google Scholar) presents Subjective Costs of Tax Compliance (with Jonathan Choi (Minnesota; Google Scholar)) today as part of the OMG Transatlantic Tax Talks Series (OMG = Oxford-Michigan-MIT-Munich-Georgetown):

This Article introduces and estimates “subjective costs” of tax compliance, which are costs of tax compliance that people experience directly and individually. To measure these costs, we conducted a survey experiment assessing how much taxpayers would pay to reduce the unpleasantness associated with filing a tax return. The experiment revealed that taxpayers are more concerned about inadvertent mistakes in their tax filings than by the time spent on compliance. Respondents also only ascribed meaningful value to eliminating all tax compliance work; they ascribed essentially no value to marginal time savings. Additionally, eliminating tax compliance time for high-income taxpayers and taxpayers with complex returns is not worth much more than eliminating tax compliance time for low-income taxpayers with simple returns. These findings have important implications for theory and policy. From a theoretical perspective, these survey results call into question the nearly universal practice of using market wages to monetize the time that people spend on tax compliance work. Indeed, our results suggest that people value their tax compliance time at a rate much lower than their hourly wage. 

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Mason Presents Bounded Extraterritoriality Today At UCLA

Ruth Mason (Virginia; Google Scholar) presents Bounded Extraterritoriality (with Michael Knoll (Penn)) at UCLA today as part of its Colloquium on Tax Policy and Public Finance hosted by Kirk Stark and Jason Oh:

Politics in the United States is ever more divided, stymying federal legislation. States have responded to this political polarization and congressional gridlock by seeking to impose their policies outside their own borders. Prominent examples include recent California regulation of the composition of corporate boards, including of companies incorporated in Delaware, as well as regulation of the size of cages that confine hogs located in other states. The Supreme Court’s withdrawal of the federal right to abortion likewise has inspired legislative proposals in abortion-restrictive states meant to hamper or forbid residents from seeking abortion services not only at home, but also in abortion-permitting states. The twenty-first century has inspired a new mode of interstate “rivalries and reprisals” consisting not of the tariffs that plagued the Founding, but rather of substantive regulation that state legislatures deliberately target outward, to behavior taking place in other states.

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