Should-Read: Greg Leiserson: The Unified Framework is a proposal for two new wasteful tax expenditures: “Unified Framework’s core proposal: preferential rates for business income…

http://equitablegrowth.org/research-analysis/the-unified-framework-is-a-proposal-for-two-new-wasteful-tax-expenditures/ Both comprehensive (integrated) income tax and consumption tax apply same rate to business and non-business income. Widely understood that preferential pass-through rate is a preference; same is true for sharply lower corporate rate.

Best approach: start over, focus on reforms to the tax base http://equitablegrowth.org/research-analysis/in-defense-of-the-statutory-u-s-corporate-tax-rate/.

Current approach: struggle with short list of (existing) tax expenditures, lose revenue (TBD scale), windfalls for wealthy & old capital.

Alt approach: scale back/eliminate the (new) tax expenditure that preferential business rates create via surtax on domestic cash flow. Effectively uses mini DBCFT as an offset for tax reform, rather than larger DBCFT as replacement for business income taxes. Ex: DBCFT as offset for modest corporate rate cut reduces harms (e.g. cost/deficits, sheltering) and reduces regressivity. Smaller scale of DBCFT-as-offset moderates challenges of the border adjustment in the Better Way plan 10/10…