Policy Problem in Public Policy Essay Example | Topics and Well Written Essays - 1500 words

Policy Problem in Public Policy - Essay Example The true character of a policy problem may be revealed in policy evaluation – therefore the two are complementary to each other’s existence. In this context, we will further discuss the nature of a policy problem with an example. As far as the income policy in the US goes, there has been an increasing trend towards inequality in recent decades. In this regard, there have been large changes in U.S. tax rules over time. These changes have gone ahead to make a considerable difference to what is reported as income on individual tax returns. With these tax changes encouraging thousands of businesses to switch from filing under the corporate tax system to filing under the individual tax system, various studies of inequality that are founded on tax return data invariably end up excluding transfer payments, which results in exaggerating the shares of income received by those at the top by ignoring growing amounts of income at the bottom. This may be defined as the basic policy problem in the US income policy. With a consistent fall in the top tax rates on wages or capital gains, there has been an increase in the reported incomes, where a larger percentage of the incomes of those at the top tend to feature in the tax returns.