Baker, A. orcid.org/0000-0001-6677-930X and Murphy, R. (2020) Modern monetary theory and the changing role of tax in society. Social Policy and Society, 19 (3). pp. 454-469. ISSN 1474-7464
Abstract
Tax is traditionally viewed as the main funding mechanism for government spending. Consequently, social policy is often seen as something determined and constrained by tax revenue. Modern Monetary Theory (‘MMT’) presents a reversal of the tax-spend cycle, by identifying a spend-tax cycle. Using the UK as an example, we highlight that one of MMT’s most important, but under-explored, contributions is its potential to re-frame the role of tax from both a macroeconomic and social policy perspective. We use insights on the money removal, or cancellation function of taxes, derived from MMT, to demonstrate how this also creates possibilities for using tax to achieve social objectives such as mitigating income and wealth inequality, increasing access to housing, or funding a Green New Deal. For social policy researchers the challenge arising is to use these insights to re-engineer tax systems and redesign social tax expenditures (STEs) for creative social policy purposes.
Metadata
Item Type: | Article |
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Authors/Creators: |
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Copyright, Publisher and Additional Information: | © The Author(s) 2020. This is an Open Access article, distributed under the terms of the Creative Commons Attribution licence (http://creativecommons.org/licenses/by/4.0/), which permits unrestricted re-use, distribution, and reproduction in any medium, provided the original work is properly cited. |
Keywords: | Tax; modern monetary theory; social policy; modern tax theory; money; debt; government |
Dates: |
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Institution: | The University of Sheffield |
Academic Units: | The University of Sheffield > Faculty of Social Sciences (Sheffield) > Department of Politics and International Relations (Sheffield) |
Depositing User: | Symplectic Sheffield |
Date Deposited: | 19 Nov 2019 10:15 |
Last Modified: | 18 Jun 2020 15:30 |
Status: | Published |
Publisher: | Cambridge University Press |
Refereed: | Yes |
Identification Number: | 10.1017/S1474746420000056 |
Open Archives Initiative ID (OAI ID): | oai:eprints.whiterose.ac.uk:153627 |
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