This paper examines how the tax simulation method can be extended to incorporate nonlinear budget constraints and nonstandard economic behavior. We simulate the effect of extending the charitable deduction to nonitemizers and study the effect of alternative "floors". The specific simulations...

The Tax Reform Act of 1969 included a provision intended to set at 50 percent the tax rate on all personal service income above the 50 percent bracket amount. The current law fails to meet this objective for the vast majority of these taxpayers. This paper explains why the current law is...

The idea that marginal tax rates and tax revenue may be inversely related is at least as old as Adam Smith's Wealth of Nations. The emergence of the "Laffer Curve" in the modern public debate on the subject has rekindled interestin this idea. The present paper uses data from the 1982 tax rate...

This paper examines the effect of capital gains tax rates on the level of capital gains realizations and the resulting amount of tax revenues. It concludes that capital gains tax revenues are maximized at a rate at the current 20 percent rate or lower, with a central estimate of 16 percent. Some...

The idea that marginal tax rates and tax revenue may be inversely related is at least as old as Adam Smith's Wealth of Nations. The emergence of the "Laffer Curve" in the modern public debate on the subject has rekindled interestin this idea. The present paper uses data from the 1982 tax rate...

The Maximum Tax on Personal Service Income was intended to reduce the maximum marginal tax rate on earned income to 50 percent. In general it did not achieve this result, although it did lower marginal tax rates on both earned and unearned income. This paper considers the effect of different tax...