Monday, November 16, 2009

Calls for review of U.S. spending buried in tax code

For those interested in the details of U.S. tax policy, they would be well advised to read a new report from tax experts Citizens for Tax Justice in Washington, explaining why it's time for the federal government to finally follow through on its long-unfulfilled promise to evaluate the usefulness of special tax breaks. As they say:

"Does the research and experimentation tax credit, for example, actually encourage research? Or does it simply enrich high-tech firms? Does the mortgage interest deduction increase homeownership, or does it only reward people who would have purchased homes anyway? Shockingly, these types of fundamental policy questions have not been addressed in any type of systematic and transparent fashion by our government.
. . .
It is difficult to imagine a desirable scenario under which the U.S. government could restore fiscal sustainability without taking a closer look at the more than $1 trillion spent annually through the tax code."

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