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Hardcover | $10.75 X | £9.95 | 568 pp. | 6 x 9 in | 5 figures, 20 tables | April 2008 | ISBN: 9780262042475
eBook | $34.00 Short | April 2008 | ISBN: 9780262251457
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Fundamental Tax Reform

Issues, Choices, and Implications
Foreword by James A. Baker


Reform of the federal income tax system has become a perennial item on the domestic policy agenda of the United States, although there is considerable uncertainty over specifics. Indeed the recent report of the President’s Advisory Panel on Federal Tax Reform recommended not one but two divergent policy directions (and included extensive discussion of a third).

In Fundamental Tax Reform, top experts in tax policy discuss a wide range of issues raised by the prospect of significant tax reform, identifying the most critical questions and considering whether the answers are known, unknown—or unknowable. The debates over tax reform usually concern the advantages and disadvantages of income-based taxation as opposed to any of the several alternative forms of consumption-based taxation. The book opens with chapters that discuss the strengths, weaknesses, and political feasibility of these options. Other chapters consider the effect of tax reform on businesses, especially their investment behavior, and include a discussion of possible problems in any transition to a consumption-based tax; international taxation issues arising in an era of globalization; and individual behavioral response to tax reform, including a view of the topic from the perspective of the relatively new field of behavioral economics.

Contributors: Rosanne Altshuler, Alan J. Auerbach, John W. Diamond, Harry Grubert, Arnold C. Harberger, Kevin A. Hassett, Thomas J. Kniesner, Laurence J. Kotlikoff, Edward J. McCaffery, Kathryn Newmark, David Rapson, Daniel Shaviro, Joel Slemrod, James P. Ziliak, George R. Zodrow.

Discussants: James Alm, Henry J. Aaron, Charles L. Ballard, Leonard E. Burman, Robert S. Chirinko, Robert D. Dietz, Malcolm Gillis, Roger H. Gordon, Jane G. Gravelle, Timothy S. Gunning, James M. Poterba, Thomas S. Neubig, Alan Viard, George Yin.

About the Editors

John W. Diamond is Edward A. and Hermena Hancock Kelly Fellow in Public Finance at Rice University’s James A. Baker III Institute for Public Policy.

George R. Zodrow is Allyn R. and Gladys M. Cline Chair of Economics and Rice Scholar, Baker Institute for Public Policy, at Rice University.


“Diamond and Zudrow have produced a timely book on fundamental tax reform that avoids revisiting old and tired issues, appeals to a broad policy-oriented audience, and draws leading scholars to comment on reform-related issues.”
Douglas Holtz-Eakin, Senior Fellow, Peterson Institute for International Economics
“This volume is required reading for anyone undertaking—or even considering—fundamental tax reform. The authors and discussants of the papers take a fresh look at important issues that many thought were settled.”
Charles McLure, Senior Fellow Emeritus, Hoover Institution, Stanford University
“Expiring tax provisions, concern over the Alternative Minimum Tax, and global competition in business taxation imply that major tax reform in the United States will be on the agenda for the next president. But which reform? This volume tackles tough questions in the effects of tax reform on business investment, asset prices, and U.S. competitiveness, and will be essential reading for economists writing on tax reform and for policy advisors.”
R. Glenn Hubbard, Dean, Columbia School of Business


Winning entry, Professional Cover/Jacket Category, in the 2009 New England Book Show sponsored by Bookbuilders of Boston.