American Enterprise Institute (AEI) economist Alex Brill’s testified before the House Subcommittee on Select Revenue Measures; He argued that the case-by-case reauthorization of tax extenders (i.e., the extensions of several temporary tax breaks) has four negative consequences:
- Tax extenders distort the fiscal budget baseline, complicating revenue and deficit forecasts
- Tax extenders create financial reporting problems for publicly traded companies by creating discrepancies in quarterly reports
- Tax extenders excacerbate the uncertainty facing businesses because businesses have to prepare for policies that are scheduled to expire but that will probably be extended
- Tax extenders fail to provide oversight of tax policy, because they most often are extended without much consideration.
Brill concludes by explaining that the solution is to either make tax extenders permanent, or cancel them all together.
AEI research fellow Alex Brill can be reached at firstname.lastname@example.org or through his research assistant at email@example.com or 202.862.4880. For additional help or other media inquiries, please contact Michael Pratt at firstname.lastname@example.org or 202.862.5823.
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