Taxation As Insurance

6 Pages Posted: 20 Jul 2016

See all articles by John R. Brooks

John R. Brooks

Georgetown University Law Center

Date Written: June 27, 2016


A central yet often overlooked aspect of an income tax is that it acts as insurance against the risk of low income. Because a person’s payments to government are a function of income, he can be assured that in a time of low income, his tax payments will decrease and transfers will increase, while the standard benefits of governments continue to flow. Because everyone, no matter how successful, faces some risk of lost income, that assurance provides us an insurance benefit, even if our income never actually drops.

JEL Classification: K34

Suggested Citation

Brooks, John R., Taxation As Insurance (June 27, 2016). Tax Notes, Vol. 151, No. 13, 2016, Available at SSRN:

John R. Brooks (Contact Author)

Georgetown University Law Center ( email )

600 New Jersey Avenue, NW
Washington, DC 20001
United States

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