Recent contributions to the theory of optimal taxation have shared a concern with the design of a tax structure de novo. In this paper, an attempt is made to use optimal tax theory as a framework for evaluating proposed changes in an existing tax system. Using data for the United States from 1967, five different tax reform proposals are examined on the basis of their impact on an explicit social welfare function.
All Science Journal Classification (ASJC) codes
- Economics and Econometrics