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IMF Staff Concluding Statement of the 2023 Article IV Mission for the U.S. Including Potential Policies to Address Fiscal Imbalances — Orbitax Tax News & Alerts

The IMF has published its Staff Concluding Statement of the 2023 Article IV Mission for the United States. A Concluding Statement describes the preliminary findings of IMF staff at the end of an official staff visit, or "mission". Missions are undertaken as part of regular consultations under Article IV of the IMF's Articles of Agreement, in the context of a request to use IMF resources, as part of discussions of staff monitored programs, or as part of other staff monitoring of economic developments.

Among other things, the Concluding Statement contains several potential policies to address fiscal imbalances. This includes that revenues could be increased through a broad-based federal consumption tax, a carbon tax, higher taxation of corporates and high-income individuals, scaling back poorly targeted tax expenditures (such as for employer-provided health care, sale of the principal residence, mortgage interest, and state and local taxes), closing tax loopholes, reducing the minimum threshold for the estate tax, and further improving revenue administration. Further, social security benefits could be indexed to chained CPI, the income ceiling for social security contributions could be raised and increases in the retirement age could be more front-loaded. Lastly, health care costs could be lowered through greater cost sharing with beneficiaries and changes in the mechanisms for remunerating healthcare providers.