On the Possibility of a No-Return Tax System

Janet Holtzblatt and
headshot of Janet Holtzblatt
Janet Holtzblatt Senior Fellow - Urban-Brookings Tax Policy Center
William G. Gale
William G. Gale The Arjay and Frances Fearing Miller Chair in Federal Economic Policy, Senior Fellow - Economic Studies, Co-Director - Urban-Brookings Tax Policy Center

September 1, 1997

Recent events have stimulated interest in reducing or eliminating the annual filing requirement in the income tax. Thirty-six countries already allow “no-return” systems for some of their taxpayers. Moving to a no-return system creates trade-offs in the structures of tax policy as well as the administration of the tax system. We estimate that roughly half of U.S. taxpayers could be placed on a no-return system with relatively minor changes in the structure of the income tax. The benefits and costs of a no-return system hinge on a number of issues that are currently unsolved.