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Friday, February 19, 2010

CRS Issue Statement on Indexation and COLAs

Brian W. Cashell, Coordinator
Specialist in Macroeconomic Policy

Gerald Mayer
Analyst in Labor Policy

Gary Sidor
Information Research Specialist

Even though inflation, for now, is subdued, in the long run it has been persistent. To insulate some aspects of the economy from the effects of rising prices, policymakers have established certain automatic adjustments that occur on a regular schedule. Among those amounts subject to automatic adjustments are federal payments such as social security benefits. In addition, some aspects of the tax code are adjusted annually to insulate taxpayers from inflation induced increases in effective tax rates.

Date of Report: January 19, 2010
Number of Pages: 2
Order Number: IS40329
Price: $7.95

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