Dan Clifton at American Shareholders Association put out some great stuff on how tax cuts are accounted for in federal budgeting…and how they’re always wrong. “The Joint Committee on Taxation forecasted the 2003 capital gains tax cut would “cost” the Federal Treasury $5.6 billion through fiscal year 2006. The new numbers today showed the federal treasury received an “unexpected” $133 billion of capital gains tax collections through 2006. Capital gains tax collections in FY 05 and FY 06 were nearly double the initial forecast. Policymakers who believe they can generate tax revenue to the federal government by raising the capital gains tax are simply mistaken.” You can see Dan’s full analysis here.
Geoffrey Segal is the director of privatization and government reform at Reason Foundation, a nonprofit think tank advancing free minds and free markets. He is also editor of Reason's Privatization Watch.