In this article, Patel and McClelland present a prototype destination basis cash flow tax to replace the existing corporate income tax. To gain some insight into the potential consequences
of the United States adopting a cash flow tax of this form the authors use a panel of tax returns over the 2004-2013 period to compare and contrast an income tax base and a cash flow tax base
on a firm by firm basis. This simulation points out the similarity of the tax bases for most firms but that treatment of import and export activity is of disproportionate importance.
Author(s): Elena Patel, John McClelland