How Updated Climate-Damage Values and Discount Rates Will Affect Regulatory Analysis
Recently completed and draft guidance is ushering in updated practices for federal benefit-cost analysis. This policy brief examines the impact of two of the most significant upcoming changes: to the discount rate and the social cost of greenhouse gases.
On November 9th, the White House finalized its revision of Circular A-4, the primary guidance on how federal agencies should assess the costs and benefits of regulations. This document plays a critical role in federal policymaking, and it had not been updated in two decades. The new guidance represents a major improvement over current practice and incorporates numerous changes that Policy Integrity has long recommended.
The Office of Management and Budget (OMB) requested input on the possibility of including an estimate of the social cost of taxation, known as marginal excess tax burden (METB), in regulatory-cost accounting for transfer rules under Executive Order 13,771. We submitted comments responding to OMB claims and providing further information about METB.
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