We think you have liked this presentation. If you wish to download it, please recommend it to your friends in any social system. Share buttons are a little bit lower. Thank you!
Presentation is loading. Please wait.
Published byAlyssa McHugh
Modified over 4 years ago
IFS Making change happen Paul Johnson IFS
© Institute for Fiscal Studies, 2008 Making change happen Mostly concerned with economics of tax –Issues of incentive compatibility, neutrality, labour supply etc But intended to influence tax policy –so needs to understand how policy change happens And how it doesnt Two chapters focussing on these issues –Political economy –Compliance and administration
© Institute for Fiscal Studies, 2008 Some thoughts on Barriers between analysis and policy –Are we even evolving in the right direction? Some changes over 30 years –And some failures to change Example of climate change
© Institute for Fiscal Studies, 2008 From economics to implementation Politics –Taxes seen in isolation –Lobbying and influence –Lack of accountability Lack of transparency Transition –Windfall gains and losses Administration Difficulty of long term commitment
© Institute for Fiscal Studies, 2008 Politics Tax policy making is different –No green papers PBR not generally playing that role –All powerful Treasury Even within the executive lack of checks and balances –Limited parliamentary accountability Greater scrutiny, both by parliament and externally are likely to be crucial
© Institute for Fiscal Studies, 2008 Political debate Discussion rarely about tax system – tax debates are disconnected –Individual elements become hard to change Elements of the system become self sustaining –Interest groups are created Example of R&D tax credit
© Institute for Fiscal Studies, 2008 Which can make for chaotic policy making 1997 10p tax rate introduced –2008 10p tax rate abolished 1997 taper relief for capital gains introduced –2008 taper relief for capital gains abolished in a farcical process Zero per cent rate for small businesses introduced and abolished Payment of tax credits …
© Institute for Fiscal Studies, 2008 Transparency Incidence very unclear – even to economists Hence role of fiscal drag, stealth taxes Different trends in NI and income tax rates –Deliberate confusion sown over role of NI Very big increases in number of higher rate tax payers –<1 million in 1985, c. 3.5 million now
© Institute for Fiscal Studies, 2008 Transition Windfall gains or losses for existing asset holders –can create major efficiency costs Short term impacts can be very different from long term –Income tax to VAT –Employer v employee NI Administrative costs, teething problems, angry losers Transition costs may be big and need weighing against benefits –Incremental reform v big bang
© Institute for Fiscal Studies, 2008 Administration How tax is administered, and compliance ensured, matters a lot –Standard theory can be extended to take account of admin issues Tax credits Self assessment Inheritance tax Future challenges
© Institute for Fiscal Studies, 2008 Good things have happened End of mortgage interest relief –Phased out carefully Widening of bases and cutting of rates –Gradual process Tax credits Abolition of ceiling for employer NICs –But not for employees More expenditure tax treatment of savings –Gradually self sustaining
© Institute for Fiscal Studies, 2008 But lots havent Abolish stamp duties Integrate income tax and NICs Widen VAT base Remove small companies corporation tax rate Stop grandfathering emissions permits
© Institute for Fiscal Studies, 2008 Climate change Very big new challenge for policy, including tax But with considerable complexity –Different starting points Economic v scientific/precautionary –Range of possible instruments –International considerations –Equity And multiple uncertainties –Including over what will happen to EU ETS
© Institute for Fiscal Studies, 2008 Approaching climate change Some basic principles government accepts, following on from Stern –Centrality of consistent pricing –Importance of international system of trading –Role of other instruments like technology support Reality is: –EU ETS is central But with grandfathered permits and limited coverage –But tax policy inconsistent and piecemeal Domestic energy consumption still subsidised
© Institute for Fiscal Studies, 2008 Conclusions Framing of policy matters –For governments and independent commentators As does understanding administration Greater transparency and scrutiny vital –And perhaps checks and balances Well be making recommendations with our eyes open…
Support to ICT Strategic Planning in the SADC Parliaments
1 Economic inactivity and progression Peter Robinson Senior Economist Institute for Public Policy Research.
Economics and Business Exchange Supported by Deloitte.
AS/A2 The national economy The UK Economy: a Health Check How well has the economy been performing, and whats round the corner? The UK Economy: a Health.
Session 1 UK Department of International Development.
Containing Health Care Costs: Market Forces and Regulation Paul B. Ginsburg, Ph.D. Center for Studying Health System Change and National Institute for.
Putting a Price on Carbon 2009 Climate Summit March 2009, Midrand Michael Goldblatt.
1 Public Economics South African research topics Andrew Donaldson National Treasury August 2009.
Copyright © 2012 Pearson Addison-Wesley. All rights reserved. Chapter 15 Finance and Fiscal Policy for Development.
The role of the state LSE400: Thinking like a social scientist Professor Tim Besley (Economics) School Professor of Economics and Political Science Professor.
Recent Trends in U.S. Nonprofit Governance
Market Orientation and Service Capability of Tendering Agent China Tendering & Bidding Association Li Xiaolin.
Cross-Border Infrastructure: A Toolkit Barriers to Cross-Border Infrastructure Development Session on Regulation & Accountability The views expressed here.
Reforming Tax Policies and Tax Administration International perspectives, lessons for Indonesia Bert Hofman, World Bank With Michael Engleschalk and Anna.
ECO 1003 Handouts for Chapters Chapter 14 Debts and Deficits: What’s a Trillion More or Less? Budget deficit The excess of government spending.
D EPARTMENT OF THE T REASURY Ageing Research - some questions Richard Murray, Executive Director, Fiscal and Corporate, Commonwealth Treasury.
USE OF COUNTRY SYSTEMS TO MANAGE CLIMATE CHANGE PAUL STEELE, UNDP.
Copyright © 2009 Pearson Addison-Wesley. All rights reserved. Chapter 15 Finance and Fiscal Policy for Development.
Fiscal Policy Chapter 12. Federal Expenditures and Revenues Source: Economic Report of the President, 2004, tables B-1 and B-79. Note, recessions are.
State & Local Taxes in Massachusetts Fall 2009 Listening Tour Representative Jay R. Kaufman Senator Benjamin B. Downing House Chair Senate Chair.
© 2019 SlidePlayer.com Inc. All rights reserved.