301. TAXES AS PANDEMIC CONTROLS.
- Author
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Craig, Ashley C. and Hines, James R., Jr.
- Subjects
Externalities (Economics) -- Management -- Research ,Tax incentives -- Influence -- Usage ,Company business management - Abstract
I. INTRODUCTION In the dramatic months of early 2020, the United States and many other countries abruptly shut down their economies in efforts to prevent widespread contagion and disease due [...], Tax policy can play important roles in limiting the spread of communicable disease and in managing the economic fallout of a pandemic. Taxes on business activities that bring workers or customers into close contact with each other offer efficient alternatives to broad regulatory measures, such as shutdowns, that have been effective but enormously costly. Corrective taxation also helps raise the revenue required to cover elevated government expenditure during a pandemic. Moreover, the restricted consumer choice that accompanies a pandemic reduces the welfare cost of raising tax revenue from higher-income taxpayers, making it a good time for deficit closure. Current U.S. tax measures serve some of these functions, but additional measures could further limit the spread of disease while also addressing government budget deficits. Keywords: taxation, externalities, COVID-19 JEL Codes: H21, H23, H24, H25, H62,118
- Published
- 2020
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