Tax Expert Yale to Join Law School Faculty

May 12, 2009

Ethan Yale, a visiting Law School professor who specializes in tax law and policy, has accepted a permanent faculty position.

Ethan Yale

Yale, who taught courses on international and federal income tax law and a tax policy seminar during the spring semester, joins the Law School from Georgetown University Law Center, where he has taught since 2004.

Professor Daniel Ortiz said Yale's work on subjects such as deferred compensation challenged conventional thinking and presented the "big picture and nitty-gritty together."

"We're very happy and lucky to have him," Ortiz said. "His students really love him and his scholarship is both very technical and very important at the same time."

Yale plans to teach tax law, including the introductory federal income tax class as well as advanced courses on subjects such as corporate, partnership, and international tax.

He said the subject appeals to him because tax law impacts nearly every other area of the law, and because there are almost always new developments emerging.

"In terms of policy changes, I think we're going to see a lot of new and interesting tax legislation," Yale said. "For example, the estate and gift tax is set to expire at the end of 2009, and most people don't think that is going to happen. So we're going to have some new legislation, and the form of that is quite uncertain."

Yale's past research includes a paper on the relationship between a proposed cap-and-trade regulatory system for greenhouse gases and federal income tax law.

"The paper pointed out that the interaction between the federal income tax law and cap-and-trade regulation could produce some distortions which could interfere with the cost effectiveness of that form of regulation, which is thought to be its chief advantage, " he said.

Yale is currently in the beginning stages of a second paper on the topic, which would address the ways that credits for the cap-and-trade system are distributed. Academics tend to conclude that an auction system in which businesses bid for credits in the cap-and-trade system would be the best solution.

"But that never happens, " Yale said. "For political reasons, they are always given to the firms for free."

However, Yale will argue that gratis allocation need not be as costly as some believe.

"Up until now, most have considered there to be two discrete policy choices, auction permits or give them away for free. But I will show that policymakers could combine tax rules and gratis allocation of pollution permits in certain ways that would allow the government to capture some fraction of the revenue it would raise through a permit auction. The main point is that by creatively shaping the tax rules that apply to pollution permits, policymakers could essentially hit any intermediate spot between auction and gratis allocation."

Yale, who visited during the 2008-09 school year, said he and his family are excited to become permanent Charlottesville residents.

Prior to Georgetown, Yale was an acting assistant professor at New York University School of Law. He was also an associate at New York law firm Wachtell, Lipton, Rosen & Katz, and a clerk for Judge Jacque L. Wiener Jr. on the 5th U.S. Circuit Court of Appeals.

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