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dc.contributor.authorAltig, Daviden_US
dc.contributor.authorAuerbach, Alanen_US
dc.contributor.authorHiggins, Patricken_US
dc.contributor.authorKoehler, Darrylen_US
dc.contributor.authorKotlikoff, Laurenceen_US
dc.contributor.authorTerry, Ellynen_US
dc.contributor.authorYe, Victoren_US
dc.contributor.authorLeisca, Michaelen_US
dc.date.accessioned2021-04-29T17:25:00Z
dc.date.available2021-04-29T17:25:00Z
dc.identifier.citationDavid Altig, Alan Auerbach, Patrick Higgins, Darryl Koehler, Laurence Kotlikoff, Ellyn Terry, Victor Ye, Michael Leisca. "Did the 2017 Tax Reform Discriminate against Blue State Voters?." Federal Reserve Bank of Atlanta, Working Papers, https://doi.org/10.29338/wp2019-07
dc.identifier.urihttps://hdl.handle.net/2144/42439
dc.description.abstractThe Tax Cut and Jobs Act of 2017 (TCJA) made significant changes to corporate and personal federal income taxation, including limiting the SALT (state and local property, income and sales taxes) deductibility to $10,000. States with high SALT tend to vote Democratic. This paper estimates the differential effect of the TCJA on red- and blue-state taxpayers and investigates the importance of the SALT limitation to this differential. We calculate the effect of permanent implementation of the TCJA on households using The Fiscal Analyzer: a life-cycle, consumption-smoothing program incorporating all major federal and state fiscal policies. We find that the average percentage increase in remaining lifetime spending under the TCJA is 1.6 percent in red states versus 1.3 percent in blue states. Among the richest 10 percent of households, this differential is larger. Rich households in red states enjoyed a 2.0 percent increase compared to a 1.2 percent increase among the rich in blue-state households. This gap is driven almost entirely by the limitation on the SALT deduction. Excluding the SALT limitation from the TCJA results in a spending gain of 2.6 percent for rich red-state households compared to 2.7 percent for rich blue-state households.en_US
dc.description.urihttp://kotlikoff.net/articles
dc.language.isoen_US
dc.publisherFederal Reserve Bank of Atlantaen_US
dc.relation.ispartofFederal Reserve Bank of Atlanta, Working Papers
dc.subjectFiscal policyen_US
dc.subjectElectionsen_US
dc.subjectTax Cuts and Jobs Acten_US
dc.subjectResource distributionen_US
dc.subjectFederal tax reformen_US
dc.subjectState and local taxesen_US
dc.subjectLife cyclee modelen_US
dc.titleDid the 2017 tax reform discriminate against blue state voters?en_US
dc.typeArticleen_US
dc.identifier.doi10.29338/wp2019-07
pubs.elements-sourcecrossrefen_US
pubs.notesEmbargo: Not knownen_US
pubs.organisational-groupBoston Universityen_US
pubs.organisational-groupBoston University, College of Arts & Sciencesen_US
pubs.organisational-groupBoston University, College of Arts & Sciences, Department of Economicsen_US
pubs.publication-statusPublished onlineen_US
dc.date.online2019
dc.description.oaversionFirst author draft
dc.identifier.mycv526424


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