Boston University School of Law
The federal income tax adjusts many but not all of its dollar components automatically to account for inflation. In this article I analyze the benefits and burdens this process confers on some taxpayers and the political logic behind them. I discuss the choice of the proper index for making the adjustments, as well as the effects of the failure to adjust specific dollar amounts. I conclude that some adjustments have become overly generous, while unadjusted provisions suffer slow repeal, sometimes intentionally. Indexation thus can have the effect of tax legislation by stealth.
Silent Tax Changes: The Political Economy of Indexing for Inflation,
Boston University School of Law, Law and Economics Research Paper
Available at: https://scholarship.law.bu.edu/faculty_scholarship/804