LEADER 03241oam 22004933a 450 001 9910702926103321 005 20230622022824.0 035 $a(NBER)w6248 035 $a(CKB)3240000000022027 035 $a(OCoLC)55668702 035 $a(EXLCZ)993240000000022027 100 $a20230622d1997 fy 0 101 0 $aeng 135 $aurcnu|||||||| 181 $ctxt$2rdacontent 182 $cc$2rdamedia 183 $acr$2rdacarrier 200 10$aSimulating U.S. Tax Reform /$fDavid Altig, Alan J. Auerbach, Laurence J. Kotlikoff, Kent A. Smetters, Jan Walliser 210 $aCambridge, Mass$cNational Bureau of Economic Research$d1997 210 1$a[Washington, D.C.] :$cCongressional Budget Office,$d[1997] 215 $a1 online resource$cillustrations (black and white); 225 1 $aNBER working paper series$vno. w6248 300 $aOctober 1997. 320 $aIncludes bibliographical references (page 29). 330 3 $aThis paper uses a new large-scale dynamic simulation model to compare the equity, efficiency, and macroeconomic effects of five alternative to the current U.S. federal income tax. These reforms are a proportional income tax, a proportional consumption tax, a flat tax, a flat tax with transition relief, and a progressive variant of the flat tax called the 'X tax.' The model incorporates intragenerational heterogeneity and kinked budget constraints. It predicts major macroeconomic gains (including an 11 percent increase in long-run output) from replacing the federal tax system with a proportional consumption tax. Future middle- and upper-income classes gain from this policy, but initial older generations are hurt by the policy's implicit capital levy. Poor members of current and future generations also lose. The The flat tax, which adds a standard deduction to the consumption tax, makes all members of future generations better off, but at a cost of halving the economy's long-run output gain and harming initial older generations. Insulating these older generations through transition relief further reduces transition relief further reduces the long-run gains from tax reform. Switching to a proportional income tax without deductions and exemptions hurts current and future low lifetime earners, but helps everyone else. It also raises long-run output by over 5 percent. The X tax makes everyone better off in the long-run and also raises long-run output by 7.5 percent. But it harms initial older generations who bear its implicit wealth tax. 410 0$aWorking Paper Series (National Bureau of Economic Research)$vno. w6248. 606 $aGeneral$2jelc 606 $aComputable General Equilibrium Models$2jelc 615 7$aGeneral 615 7$aComputable General Equilibrium Models 686 $aH20$2jelc 686 $aC68$2jelc 700 $aAltig$b David$0119422 701 $aAuerbach$b Alan J$0115466 701 $aKotlikoff$b Laurence J$0124852 701 $aSmetters$b Kent A$01363736 701 $aWalliser$b Jan$01143280 712 02$aNational Bureau of Economic Research. 801 0$bMaCbNBER 801 1$bMaCbNBER 906 $aBOOK 912 $a9910702926103321 996 $aSimulating U.S. Tax Reform$93389959 997 $aUNINA