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ECONOMIC ISSUES IN THE CAMPAIGN
HEALTH CARE, TAXES, TRADE, AND
THE FINANCIAL CRISIS
October 14, 2008
Palmer
Commons, Great Lakes South Central Room, 4th
Floor
4:15 – 6:00 p.m.
In
this year’s presidential election, economic issues
have been paramount, and making an informed voting
decision requires understanding the positions of
each candidate. The Office of Tax Policy Research
at the Ross School of Business invites you to a live
commentary on four of the hottest topics – health
care, taxes, trade, and, of course, the
housing/financial crisis – by members of the
University faculty. Although the candidates
themselves will not attend, both will be present in
the form of video clips from their speeches and
debate performances. The panel members will
critique the candidates’ proposals and offer their
own views on the issues.
Thomas Buchmueller, Waldo O. Hildebrand Professor of
Risk Management and
Insurance; Professor of Business Economics and
Public Policy
James Levinsohn, J. Ira and Nicki Harris Family
Professor of Public Policy,
Professor of Public Policy, Professor of Economics
Joel Slemrod, Paul W. McCracken Collegiate Professor
of Business Economics
and Public Policy, Professor of Economics, Director,
Office of Tax Policy
Research
Robert Van Order, Adjunct Professor of Finance,
Former Chief International
Economist, Freddie Mac.
For further information, please
contact the Office of Tax Policy Research –
otpr@umich.edu or
763-3068.
NEW RESEARCH -- INCOME TAX
NONCOMPLIANCE BY INCOME GROUP
New research by
OTPR Director Joel Slemrod and IRS employee Andrew
Johns looks at income tax noncompliance by income
group. It makes use of newly available data for tax
year 2001 from the IRS’s most recent comprehensive
study of individual income tax noncompliance, the
National Research Program. The study finds that,
when taxpayers are arrayed by their “true” income,
defined as reported income adjusted for the
underreporting estimated by the IRS tax gap
methodology, the ratio of aggregate misreported
income to true income generally increases with
income, although it peaks among taxpayers with
adjusted gross income between $500,000 to
$1,000,000, and is lower than the peak ratio for
individuals with income above $1,000,000. In sharp
contrast, though, the ratio of underreported tax to
true tax is highest for lower-income taxpayers.
This contrast in results reflects the fact that
under a graduated tax schedule a given percentage
reduction in taxable income corresponds to a higher
percentage reduction in tax liability the lower is a
taxpayer’s income. Much, but not all, of the
distributional pattern of noncompliance is related
to the fact that on average high-income taxpayers
receive their income in forms that have higher
noncompliance rates. To view this paper, please
click here.
CALL FOR PAPERS
THE ROLE OF FIRMS IN TAX SYSTEMS
April 17-18, 2009
Ross School of Business, University of Michigan, Ann Arbor, MI
On April 17-18, 2009, the Office of Tax Policy Research will sponsor a conference in Ann Arbor on the role of firms in tax systems. For more information, please visit our Conferences & Seminars page.
WILL TAX REBATES WORK?
The weakening economy has prompted serious consideration of a package of fiscal stimulus measures to accompany the recent Fed action to lower interest rates. Tax rebates feature in many prominent stimulus proposals. But how much would tax rebates really help the economy? Timing is crucial--past experience has shown that the legislative process and operational preparation can take many months before rebates get to taxpayers. More importantly, evidence from the 2001 experience with tax rebates suggests that they may not be as effective as many might hope, because consumers use the rebate checks to save or pay down debt more than they use them to spend.
Professors Joel Slemrod and Matthew D. Shapiro researched the effects of the 2001 rebates. Their analysis can be found in the following papers:
THE OFFICE OF TAX POLICY
RESEARCH is a research office of the Stephen M. Ross
School of Business at the University of Michigan. OTPR
supports and disseminates academic research on all
aspects of the tax system, with the goal of informing
discussion about the future course of policy. We are
non-partisan and advocate no particular policies.
This Web site is a guide to the activities we sponsor,
to the findings of the research we have supported, and
to the policy implications of that research.
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