Incorrect projection of indexed policy parameters in some cases

[martinholmer]

The Policy class uses grow-factor values (for the ACPIU and AWAGE factors) to project indexed tax policy parameters beyond the Policy.LAST_KNOWN_YEAR. In most cases this is done correctly. However, since the Policy class was rewritten to use ParamTools in PR #2401 the projection of indexed parameters is done incorrectly is some cases. The most common case is when the Policy class constructor is passed a GrowFactors object that contains ACPIU or AWAGE values that differ from the values in the taxcalc/growfactors.csv file, which is generated in the taxdata repository for use with the CPS and PUF input data that are generated in that repository. The different grow-factor values could represent some kind of macroeconomic response to a tax reform that is thought to change future price-inflation rates or wage-growth rates. Or the different grow-factor values could be those used by the TMD data, which include their own tmd_growfactors.csv file that may differ from the CPS- and PUF-related growfactors.csv file included in the taxcalc package.

In all these cases, the Policy constructor is passed a GrowFactors object that is different from the default object created by the GrowFactors constructor (that is, by using GrowFactors()). The buggy logic is in the Policy.set_rates method

Tax-Calculator/taxcalc/policy.py

Line 166 in 1cad505

self._gfactors = GrowFactors()

and in the Parameters.adjust_with_indexing method

Tax-Calculator/taxcalc/parameters.py

Line 252 in 1cad505

self._gfactors = GrowFactors()

where the custom self._gfactors object passed to the Policy constructor is overwritten by self._gfactors = GrowFactor() statement. This overwriting incorrectly changes the custom grow-factor values to the default grow-factor values. This mistake means that in these cases, the wrong values of ACPIU and AWAGE are being used to project indexed policy parameters beyond Policy.LAST_KNOWN_YEAR.