Sustainability and Tax Policy

Tracy Noga, Bentley University, Accounting

Summary

In this assignment students were asked to propose a tax policy change that would encourage businesses or individuals to promote a more sustainable economy. Students are encouraged to think broadly in terms of policy options but to focus on one specific piece of promoting a more circular economy.

Sustainability, Accounting | College Lower (13-14), College Upper (15-16)

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Learning Goals

Student learn to generate ideas to address wicked problems and think about how to incentivize individuals/businesses to participate in the solution. They are also required to consider unintended consequences of what they are proposing. The activity reinforces both the ideas of wicked problems ans sustainability but also how tax policy works.

Context for Use

This activity is a follow-on to the Wicked Problem of an Equitable Zero-Waste Circular Economy module.

This assignment has been used in both an under graduate and graduate Introduction to Income Tax course. After understanding the basics of tax policy and how the US income tax system works they are able to generate ideas on how to effectively use tax policy to promote sustainability. They could be asked for one or more ideas and it could be done individually or in a group. This was done at the end of the course when they had a sufficient foundation of tax knowledge.

Description and Teaching Materials

Develop one reasonable federal level tax policy proposal that would encourage businesses or individuals into a circular economy. Focus on one piece of a process of the chocolate lifecycle. Brainstorm a bit then decide on the best one. This should be a thoughtful proposal. Include the following in your discussion:

Description of the proposal including
- is it tax penalty or tax benefit
- is it geared toward income, deductions, credits or an additional tax
- Taxpayers the law would be applied to: Business or Individual
Does the proposed law address a specific inequity (or inequities)?
What is the intended result of the law?
What are the potential unintended consequences of the law?

Teaching Notes and Tips

This is a straight forward assignment. Many students are quite enthusiastic about it. The most common stumbling block is students are over ambitious with the proposal making it too complex. This assignment can be changed to include more than one idea or a different product. It can be done individually or in a group.