Tax Cannibalization and Fiscal Federalism in the United States
Document Type
Article
Publication Date
2017
Abstract
We began this project pondering a riddle. Most state governments have adopted what we-and many others-view as clearly suboptimal tax policies, especially in regard to the taxation of corporate income and capital gains. Yet, with the notable exception of those who oppose progressivity and the taxation of capital, state-level tax policymakers have had remarkably little appetite for reform.
This Article provides one major explanation for this riddle by identifying and demonstrating a phenomenon that we label as "tax cannibalization." We argue that flawed state-level tax policies derive in part from perverse incentives inadvertently created by the federal government.
Recommended Citation
David Gamage and Darien Shanske,
Tax Cannibalization and Fiscal Federalism in the United States, 111 Northwestern University Law Review 295
(2017).
Available at: https://scholarship.law.missouri.edu/facpubs/1148