Equal Yield Tax Alternatives and Government Deficits

• Autor(a) principal: Pereira, Alfredo M.
• Data de Publicação: 1990
• Tipo de documento: Artigo
• Idioma: eng
• Título da fonte: Repositório Científico de Acesso Aberto de Portugal (Repositórios Cientìficos)
• Texto Completo: http://hdl.handle.net/10362/84953

This paper generalizes the concept of equal yield to accommodate government deficits. This generalization is important from the point of view of actual tax reform. First, the comparison of the several equal yield alternatives developed in this paper provides a measure of the marginal financial crowding-out effects of government deficits. Second, it suggests that the emphasis by policymakers on revenue neutrality is misplaced and should be replaced by a direct emphasis on deficit neutrality. The generalized concept of equal yield is illustrated with a dynamic general equilibrium model of the U.S. economy and the analysis of the effects of integrating the personal and corporate income tax systems.