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Hamilton Project Hosts Program Today on Entitlements, Taxation, and Revenues in the Federal Budget

Hamilton ProjectThe Hamilton Project hosts a program today on Real Specifics: 15 Ways to Rethink the Federal Budget—Part II: Addressing Entitlements, Taxation, and Revenues:

Budget battles continue in Washington even after the White House and
Congress cut a last-minute deal to avert the so-called “fiscal cliff.” 
With the imminent threat of default removed for now, the next potential
challenge to the economy could come from sequestration, set to go into
effect on March 1.

The Hamilton Project asked experts from a
variety of backgrounds—the policy world, academia, and the private
sector—and from both sides of the political aisle, to provide
innovative, pragmatic proposals for lowering the deficit by reducing
expenditures or raising revenues, and that take into account impacts to
the economy at large. 

The resulting 13 proposals
range across budget groups, and include options to reduce mandatory and
discretionary programs, to improve economic efficiency, and touch on
topics as wide ranging as immigration, transportation, healthcare, and
mortgage interest.  This diverse group of authors will convene in at a
forum today in Washington, D.C. to discuss their ideas in a
series of roundtable discussions.

Here are the tax-related panels:

Panel #2:  Innovative Approaches to Tax Reform:

Robert Greenstein (Center on Budget and Policy Priorities) (moderator)

  • Joseph E. Aldy (John F. Kennedy School of Government, Harvard University), Eliminating Fossil Fuel Subsidies:  "This paper looks at how limiting subsidies for fossil fuels could raise revenue for the federal
    government and while also benefiting the environment. It proposes the elimination of twelve tax
    provisions that subsidize the production of fossil fuels in the United States."
  • Karen Dynan (The Brookings Institution), Better Ways to Promote Saving through the Tax System:  "Government programs and tax provisions aimed at encouraging people to save are essential to
    promoting economic security, but can subsidize savings that would have occurred anyway. This
    paper examines the design of better savings programs, outlining how one could reform savingsrelated
    programs to increase security but lower budgetary cost."
  • Diane Lim (Pew Charitable Trusts), Limiting Individual Income Tax Expenditures: "This paper takes another approach to individual income tax expenditures, proposing an across-the-board reduction in deductions and exclusions rather than targeting specific provisions."
  • Alan Viard (American Enterprise Institute), Replacing the Home Mortgage Interest Deduction: "Tax reform discussions often end up calling for a broader base—eliminating or limiting tax
    exclusions and deductions that can distort taxpayer decisions. This paper addresses replacing the
    mortgage interest deduction with a refundable credit to raise revenue and improve the efficiency of
    the tax code."

Panel #3:  New Sources of Revenue and Efficiency:

Michael Greenstone (The Hamilton Project, The Brookings Institution) (moderator)

  • Tyler Duvall (McKinsey & Company), User Fees for Transportation Infrastructure:  "Investments in infrastructure are essential for a vital economy, but much of U.S. transportation
    infrastructure is in disrepair and overly congested. This paper looks to user fees as a way to raise
    revenues while also encouraging smarter use of infrastructure."
  • Bill Gale (The Brookings Institution) & Ben Harris (The Urban Institute), Creating an American Value-Added Tax:  "Creating a value-added tax (VAT) in the United States could help raise revenue in a manner that
    does not distort saving and investment choices, that makes our system more consistent with the
    rest of the world’s, and that has been proven to be feasible administratively. This paper considers
    how a VAT could contribute to a fiscal solution and discusses its design."
  • Adele Morris (The Brookings Institution), The Many Benefits of a Carbon Tax:  "A carbon tax could provide a new source of revenue while also addressing climate change more
    efficiently than many current regulations in place. This paper lays out a plan to implement a carbon
    tax while consolidating and limiting other regulations targeting climate change."
  • Pia Orrenius (Federal Reserve Bank of Dallas), Overhauling the Temporary Work Visa System:  "A simplified immigration system designed to meet the needs of the economy would allow the
    United States to maximize the many benefits of immigration. This paper explores how reforms to
    the employment-based immigration system could increase the economic benefits of immigration
    while also raising revenue by auctioning visas."
  • Phillip Swagel (School of Public Policy, University of Maryland), Increasing the Role of the Private Sector in Housing Finance:  "Government support for housing has allowed Americans to get mortgages and refinance at low
    interest rates, but it also leave taxpayers exposed to an immense amount of risk. This paper
    presents an overview of how changes in housing policies and reform of government-sponsored
    enterprises could contribute to budget savings as well as improve the distributional consequences
    and efficiency of federal housing policy."

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