As Congress works to reconcile House and Senate versions of tax legislation through a conference committee — and as new scores estimating the budgetary and economic effects of the legislation are released — it is important for policymakers and the general public to have a full understanding of the various analyses and the underlying approaches to better interpret their meaning.
The budgetary and economic effects of proposed tax legislation are a critical element of the debate. While these effects are central to tax policy, the modeling assumptions underlying them are often not adequately understood.
To help illuminate the assumptions and methodologies used in modeling changes to tax policy, the Peterson Foundation asked three non-governmental organizations — the Penn Wharton Budget Model, the Tax Foundation, and the Tax Policy Center — to answer a set of nine questions that highlight important aspects of tax modeling. Each organization independently submitted its written responses, which are shown in the report.
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Further Reading
Six Charts That Show Why Corporate Tax Revenues are Low in the U.S. Right Now
Compared to historical trends and other advanced economies, corporate tax revenues in the United States are low.
The U.S. Corporate Tax System Explained
Revenues raised by the corporate income tax represent the third-largest category of federal revenues in the United States.
How No Tax on Overtime Will Affect Federal Revenues and Tax Fairness
This new, temporary deduction will cost $90 billion dollars over the next four years, while undermining tax equity and making the tax system more complex.