When Does Tax Reform Happen?

Document Type

Article

Publication Date

8-2026

Abstract

Institutional form of the ability-to-pay concept, while progressive rate structures reflect a normative choice about fiscal distribution and how tax burdens should be allocated across income classes. Consumption taxes appear as expressions of tax efficiency and neutrality, and VAT, in its different versions, appears as administrative improvements over retail sales taxes or turnover taxes. More recently, digital services taxes appeared as corrective instruments for a digital economy in which users and markets help generate value without the physical presence that traditional income tax rules once required, while tariffs appear and reappear as tools of protection, retaliation, bargaining, industrial policy, and even national security.

Comments

Reprinted with the permission of Tax Analysts.

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