Tax Law

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Essay
Volume 93.2
When Should the Legal System Help Redistribute Income?
Jacob Goldin
Richard M. Lipton Professor of Tax Law, The University of Chicago Law School and Research Professor, American Bar Foundation.

For helpful comments, we are grateful to Kiran Chawla, Lee Fennell, Louis Kaplow, Adi Leibovitch, Richard McAdams, David Weisbach, workshop participants at the University of Chicago, and the editors of The University of Chicago Law Review. We thank Hannah Lu and Safia Sayed for excellent research assistance.

Zachary Liscow
Professor of Law, Yale Law School.

For helpful comments, we are grateful to Kiran Chawla, Lee Fennell, Louis Kaplow, Adi Leibovitch, Richard McAdams, David Weisbach, workshop participants at the University of Chicago, and the editors of The University of Chicago Law Review. We thank Hannah Lu and Safia Sayed for excellent research assistance.

Should legal rules be designed exclusively based on efficiency considerations, or should they also attempt to promote an equitable distribution of social resources? The answer traditionally associated with scholarship in law and economics is that they should focus only on efficiency. Even for a society that cares about achieving an equitable distribution of resources by income, the argument goes, it is generally better to adopt legal rules based exclusively on efficiency considerations while relying on the income tax and transfer system to promote distributional goals. However, even proponents of the claim that social welfare is best promoted through the adoption of efficient legal rules agree that there are certain conditions under which it does not apply. This Essay considers when legal rules should be efficient and when they should not. It focuses on conditions that can cause the socially optimal legal rule to diverge from the efficient legal rule—i.e., the legal rule that would be optimal absent distributional considerations. Its goal is to translate these arguments to settings where the question of interest relates to the design of a legal rule rather than, say, the design of a commodity tax. In particular, it seeks to clarify the types of arguments that can support the adoption of inefficient legal rules when income taxation is available as a policy tool.

Law and Economics Tax Law
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Article
75.3
The Tax Advantage to Paying Private Equity Fund Managers with Profit Shares: What Is It? Why Is It Bad?
Chris William Sanchirico
Professor of Law, Business, and Public Policy and Codirector of the Center for Tax Law and Policy, University of Pennsylvania Law School, Wharton School, Business and Public Policy Department

For helpful comments, I thank Alan Auerbach, Alan Blinder, Mitchell Engler, Victor Fleischer, Mark Gergen, Kevin Hassett, James Hines, Mitchell Kane, Alex Raskolnikov, Julie Roin, Frank Sammartino, Daniel Shaviro, Joel Slemrod, Gene Seago, David Weisbach, Larry Zelenak, and participants at the University of Michigan’s Tax Policy Workshop Series and NYU’s Colloquium Series on Tax Policy and Public Finance. Special thanks to Reed Shuldiner and Michael Knoll for many useful discussions. This research was not supported by funding from any outside source. The working paper version of this Article was first circulated and posted on SSRN on June 25, 2007. See Chris William Sanchirico, The Tax Advantage to Paying Private Equity Fund Managers with Profit Shares: What is It? Why is It Bad? (University of Pennsylvania Institute for Law and Economics Research Paper No 07-14, June 25, 2007), online at http://ssrn.com/abstract= 996665 (visited June 8, 2008).

Business Organizations Financial Regulation Tax Law
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Essay
77.1
Affordable Private Education and the Middle Class City
Nicole Stelle Garnett
Professor of Law, Notre Dame Law School

I received valuable comments from participants in The University of Chicago Law School’s Symposium, Rethinking the State and Local Government Toolkit, and from Tricia Bellia, Peg Brinig, Rick Garnett, Mark McKenna, and John Nagle. Jessica Laux and Mariangela Sullivan provided excellent research assistance.

Cities Education Tax Law
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Comment
84.4
The Label Test: Simplifying the Tax Injunction Act after NFIB v Sebelius
Brett J. Wierenga
BA 2014, Hillsdale College; MSc 2015, University of Oxford; JD Candidate 2018, The University of Chicago Law School

In National Federation of Independent Business v Sebelius (“NFIB”), the Supreme Court maintained both its jurisdiction over the case and the constitutionality of the Affordable Care Act (ACA) by threading the needle between the Anti-Injunction Act (AIA) and Congress’s taxing power under the Constitution.

Affordable Care Act Statutory Interpretation Tax Law Textualism
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Article
84.3
The Unexpected Role of Tax Salience in State Competition for Businesses
Hayes R. Holderness
Assistant Professor of Law, University of Richmond School of Law; JD, 2011, NYU School of Law; LLM, 2012, NYU School of Law

Many thanks to the faculty of the University of Illinois College of Law for the support and guidance provided to me while drafting this Article as a Visiting Assistant Professor of Law at the College. My particular gratitude belongs to John Colombo, Dhammika Dharmapala, David Gamage, Ari Glogower, Michael Hatfield, Paul Heald, Dick Kaplan, Bob Lawless, Laurie Malman, Arden Rowell, Erin Scharff, Darien Shanske, Jamelle Sharpe, Lesley Wexler, the participants at the 2016 Big Ten Junior Scholars Conference, and the participants at the Washington University Faculty Workshop Series for their time and insights regarding earlier drafts of this Article.

In 2012, Amazon agreed to invest $130 million in building two fulfillment centers and to create 1,500 jobs in New Jersey in exchange for the state relieving Amazon of its sales-tax-collection obligations.

Behavioral Economics Law and Economics State Law Tax Law

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