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Knowledge Base

Reforming The Tax Code

What is the OECD?

OECD is acronym for the Organization for Economic Co-operation and Development, which is a group of 34 member countries that discuss and develop economic and social policy. It is frequently used to compare tax and spending policies across developed countries.

What is a corporate tax?

The corporate tax is a levy placed on the profit of a firm to raise taxes. Rules surrounding corporate taxation vary greatly around the world. The U.S. has the highest corporate tax rate in the OECD.

What are marginal taxes?

A marginal tax rate is the amount of tax paid on an additional dollar of income. The marginal tax rate for an individual affects their decision to work, invest, or save any more than they currently do. If an individual has a high marginal tax rate, they are less likely to work and earn an additional dollar than an individual with a low marginal tax rate.

What are tax expenditures?

Tax expenditures provide politically favored organizations, industries, or individuals exemptions or deductions from gross income in order to encourage and support specific activities. The tax exemption on employer-provided health insurance is one of the largest tax expenditures, leaving hundreds of billions of dollars of tax revenue uncollected in order to promote the purchase of health insurance by workers in the economy.