National Tax Journal

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Note from the editors.
The last few months have seen many changes at the National Tax Journal. After nearly eight years of dedicated service to the NTJ, Therese McGuire has stepped down as editor. Therese will be sorely m . . .

The earned income tax credit and reported self-employment income.
The Earned Income Tax Credit (EITC) is widely recognized to have increased employment, particularly among single mothers with low levels of education. For purposes of calculating the credit, the tax . . .

Charity, impure altruism, and marginal redistributions of income.
Pure altruists receive utility from how much the poor consume, whereas warm glow is utility from the size of one's own contribution. Andreoni (1989, 1990) showed that if households receive warm-glow . . .

Empirical evidence on the revenue effects of state corporate income tax policies.
State corporate income tax (SCIT) revenues have declined significantly over the past 20 years, prompting vigorous debates about the likely causes of, and potential remedies for, this decline. Confou . . .

Minnesota's earned income credit program: utilization by current and former welfare households and the impact of policy paramete
In this paper, we examine the utilization of a state earned income credit program among current and former welfare recipients, where earned income credit utilization is characterized by two measures . . .

Income mobility in the United States: new evidence from income tax data.
INTRODUCTION Many studies have documented the long-term trend of increasing income inequality in the U.S. economy. U.S. Census data, for example, show that the share of household income of the top . . .

Stepping stone or dead end? The effect of the EITC on earnings growth.(earned income tax credit)
INTRODUCTION Numerous studies have found that expansions in the Earned Income Tax Credit (EITC) led to increases in employment for single mothers (Eissa and Liebman, 1996; Meyer and Rosenbaum, 200 . . .

Earnings volatility across groups and time.
INTRODUCTION Earnings volatility is of fundamental interest to many different groups of economists. Researchers studying tax policy are interested in earnings volatility because of the implication . . .

Institutional Foundations of Public Finance: Economic and Legal Perspectives.(Book review)
Institutional Foundations of Public Finance: Economic and Legal Perspectives. Edited by ALAN J. AUERBACH and DANIEL N. SHAVIRO. Cambridge, MA and London: Harvard University Press, 2008, pp. 282. I . . .

Note from the editors.
The papers in the NTJ March Forum provide three different perspectives on the critical tax policy issue of book-tax conformity--the extent to which accounting for tax purposes conforms to the standa . . .

The effects of multinationals' profit shifting activities on real investments.
INTRODUCTION Corporate tax rates vary significantly between different countries. Real investment decisions are affected by these international differences in business taxation. Moreover, cross-cou . . .

Measuring non-school fiscal disparities among municipalities.
INTRODUCTION Fiscal disparities among parallel governments--municipalities within a state or states within the nation--represent a policy concern when the overlying government (state or nation) ha . . .

Does the NEA crowd out private charitable contributions to the arts?(National Endowment for the Arts)
INTRODUCTION This paper investigates the mechanism by which the federal government s funding of the arts through the National Endowment for the Arts (NEA) displaces private charitable contribution . . .

Inter-temporal differences in the income elasticity of demand for lottery tickets.
INTRODUCTION Beginning with New Hampshire in 1964, 42 states and the District of Columbia have legalized state-sponsored lotteries. Lottery sales in the United States topped $48 billion in fiscal . . .

Spatiality and persistence in U.S. individual income tax compliance.
INTRODUCTION The individual income tax system in the United States operates on a self-assessment basis, in which individuals annually determine their tax liability and pay what they deem due. Over . . .

Book-tax conformity: implications for multinational firms.
INTRODUCTION This paper examines the implications for multinational firms of recent proposals to conform tax and financial reporting (i.e., book-tax conformity). Proponents of book-tax conformity . . .

Earnings management, corporate tax shelters, and book-tax alignment.
INTRODUCTION The influence of taxes on corporations has largely been considered within a framework where taxes are involuntary payments that influence financing and investment choices on the margi . . .

Richard Musgrave Prize.
Since 1999, the Richard Musgrave Prize has been presented annually to the author(s) of the most outstanding paper published in the National Tax Journal. With this award, the National Tax Association . . .

Note from the editors.
The papers in this issue's forum are revised versions of a select group of papers presented at the Tenth Annual UNC Tax Symposium held at the University of North Carolina in Chapel Hill, NC, Match 2 . . .

Tax motivated takings.
Tax motivated takings are takings by a local government aimed purely at increasing its tax base. Such an action was justified by the Supreme Court's ruling in Kelo v. New London (2005), which allowe . . .

Distributional consequences of converting the property tax to a land value tax: replication and extension of England and Zhao.
In a recent article in this journal, England and Zhao (2005) examine the redistribution of the tax levy that would result in Dover, New Hampshire, if the real property tax were changed from the exis . . .

The impact of school district consolidation on housing prices.
School district consolidation has been one of the most dramatic changes in education governance and management in the United States in the last one hundred years. This paper estimates the capitaliza . . .

The income elasticity of gross casino revenues: short-run and long-run estimates.
Commercial casino gambling has spread rapidly since 1990 when only two states, Nevada and New Jersey, allowed private commercial gambling. By 2008, 11 states allowed private commercial gambling, whi . . .

Thin markets and property tax inequities: a multinomial logit approach.
Property tax assessment ratios--a property's assessed value divided by its market value--determine the effective tax rates paid by owners. When ratios in the same assessment district vary, the prope . . .

Why do nonprofits have taxable subsidiaries?
INTRODUCTION Although most types of revenue earned by nonprofit organizations are tax exempt, nonprofits engage in two types of taxable activities (Plunkett and Christianson, 2004). First, a nonpr . . .

Taxes and financial assets: valuing permanently reinvested foreign earnings.
INTRODUCTION We investigate how tax rules interact with foreign investments to affect the value of U.S. multinational corporations' "permanently reinvested earnings" (PRE). Prior studies in econom . . .

Taxes and ex-day returns: evidence from Germany and the U.K.
INTRODUCTION previous studies show that the risk-adjusted abnormal returns on the ex-dividend dates are positive and significantly related to the dividend yield. However, the interpretation of the . . .

Methods of capital gains taxation and the impact on asset prices and welfare.
INTRODUCTION In most of the world's economies, changes in the value of an investor's asset (or entire portfolio) are subject to a tax, the so-called capital gains tax. From a theoretic point of vi . . .

Introduction.
Because, at its core, implementing taxation is a problem of information, the information revolution has the potential to radically alter the relationship between taxpaying citizens and the state. Ne . . .

Using technology to simplify individual tax filing.
INTRODUCTION The individual tax filing system imposes substantial costs upon taxpayers. Estimating those costs is an imprecise art, which requires a combination of definitional assumptions (e.g., . . .

Technology and taxation in developing countries: from hand to mouse.
INTRODUCTION Technology has influenced the way we work, play, and interact with others. It is not surprising that technology has also affected how tax systems are designed and administered in deve . . .

The SSTP and technology: implications for the future of the sales tax.
INTRODUCTION The technological advances of the last several decades may have greater implications for the sales tax than for any other tax imposed in the U.S. The implications go far beyond how ta . . .

Genes as tags: the tax implications of widely available genetic information.
INTRODUCTION The other essays in this volume make clear that the future of taxation depends importantly on innovations in the gathering and processing of information. As the so--called information . . .

Problems and promise of smart cards in taxation.
INTRODUCTION Administrative issues do not usually make for exciting economics. They usually fall into the forgotten footnotes of scholarly articles that are primarily concerned with grander vision . . .

The future of tax privacy.
INTRODUCTION The history of tax privacy contains a number of surprises. First, the concept of tax privacy was a contested one throughout much of the 19th and 20th Century. For a period, tax return . . .

The 2001 and 2003 tax rate reductions: an overview and estimate of the taxable income response.
INTRODUCTION The Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) and the Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA) which are the focus of this paper, incorp . . .

Distributional effects of the 2001 and 2003 tax cuts: how do financing and behavioral responses matter?
INTRODUCTION Distributional analysis has long been a central element in discussions of tax policy. However, standard methods of estimating the distributional effects of tax changes omit two potent . . .

The effect of the May 2003 dividend tax cut on corporate dividend policy: empirical and survey evidence.
INTRODUCTION In December 2002, the Bush administration floated a radical proposal to reduce the taxation on dividends to zero. The official motive behind the proposal was to give the economy a boo . . .

Taxation of capital and labor: the diverse landscape by entity type.
INTRODUCTION The purpose of this paper is to derive standardized measures of labor and capital income that account for the different reporting requirements and levels of compliance faced by differ . . .

Tax policy and sole proprietorships: a closer look.
INTRODUCTION The businesses and self-employed individuals represented by the 21 million sole proprietorship forms filed with individuals' income tax returns for 2005 represent a wide variety of ec . . .

The taxation of carried interest: understanding the issues.
INTRODUCTION In the spring of 2007, a then-unpublished law review article by Victor Fleischer helped turn an obscure aspect of partnership taxation into a contentious tax policy issue. Intense med . . .

Foreign income and domestic deductions.
INTRODUCTION Income tax systems, such as that used by the United States, permit taxpayers to claim deductions for expenses incurred in the course of earning income. Thus, a taxpayer who spends $10 . . .

Energy tax incentives and the alternative minimum tax.
INTRODUCTION Energy-related subsidies in the federal tax system are under increasing scrutiny. Some note that the tax system provides large subsidies to oil and gas producers at a time when we sho . . .

A tax-based approach to slowing global climate change.
"The U.S. must engage in an energy efficiency program that takes effect without delay and has meaningful bite. As long as developing countries can point to the U.S. as a free rider there will not be . . .

Social policy and the U.S. tax code: the curious case of the low-income housing tax credit.
INTRODUCTION Much of the federal tax code, particularly the numerous carve-outs of credits and deductions from the personal income tax, was created to support various social policy goals. Currentl . . .

State and local finances and the macroeconomy: the high-employment budget and fiscal impetus.
INTRODUCTION Once again, states and localities are facing budgetary pressures and may be forced to take action to get their fiscal houses in order. Indeed, as measured in the National Income and P . . .

The crisis in state and local government statistics.
Robust statistical systems produce products that are important to understanding the changing state of the economy and to formulating sound policy. But statistical systems, like physical infrastructu . . .

The connection between house price appreciation and property tax revenues.
INTRODUCTION In the wake of the real estate boom in the first half of this decade, the property tax revenues of local governments soared, growing 50 percent faster from 2001 through 2005 than they . . .

Richard Musgrave Prize.
Since 1999, the Richard Musgrave Prize has been presented annually to the author(s) of the most outstanding paper published in the National Tax Journal. With this award, the National Tax Association . . .

2008 National Tax Association: Annual Competition for Outstanding Doctoral Dissertations in Government Finance and Taxation.
All graduate students at accredited U.S. and Canadian Institutiorls and individuals who will receive the doctoral degree et its equivalent after July 1, 2007, and before June 1, 2008. are eligible f . . .