Linda Sugin (Fordham; Google Scholar) presents Proxy Taxes at San Diego right this moment as a part of its Tax Legislation Speaker Collection:

This text gives a conceptual and theoretical framework for seemingly oddball and unprincipled provisions within the Inner Income Code, praising them for growing progressivity and producing income.  “Proxy taxes” impose legal responsibility on taxpayers with potential to pay who’re related, indirectly, to earnings earners who pay inadequate or no tax on that earnings.  Given the mixture of rising earnings and wealth inequality and the political impossibility of elevating taxes on earnings in an easy approach, policymakers ought to embrace proxy taxes as a versatile resolution to a urgent tax justice downside.  This text argues that proxy taxes contribute to a extra complete earnings tax system, regardless of their departure from basic earnings tax rules, and will also be extra environment friendly than larger taxes imposed on earnings.

Whereas accepting the company governance critiques within the literature, the article endorses §162(m)’s restrict on the deduction for government compensation as a fantastic proxy tax on labor earnings.