ABSTRACT
Taxation is specially suitable for public policy analysis, because revenue is the result of the interaction of laws, administration and economic activities; it is thus intrinsically interdisciplinary. A significant change in taxation requires a political will strong enough to redirect a tax system that moves with great force from its own momentum, and to accept the resulting political criticism for introducing new tax measures. Taxation is a political orphan. The administrative apparatus for tax collection is sustained by political inertia. Political inertia is the force that makes it possible for politicians to raise the maximum of tax revenue with the minimum of political costs. The concerns of politicians are immediately relevant in making public policy, including major economic decisions. A public-policy analysis of taxation should combine both general and specific knowledge. The chapter also presents an overview of the key concepts discussed in this book.
