The model you reference has nothing to do with the embedded taxes or even compliance costs.
ROTFLMAO, the baseline the ouput is the result of math representation of the current system as it tracks historical tax and economic data series.
How Jorgenson came up with those numbers is what I am interested in.
He establishes parametric functions representing the economic data series from which they are derived, NIPA, CES, IRS tax data, and other statistical data sources evaluated over time isolating the parametric factors that represent business, consumer, labor and govenment economic factors relating to the solution the problem.
His modelling of what happens after if a sales tax is enacted is a completely different issue.
His studies include both the historical system (baseline) and the new tax policy implementation, providing comparative differences between the two for outputs. As such they are the issue.
You can laugh all you want, but that does nothing to explain how Jorgenson calculates embedded taxes and compliance costs. I enjoy your use of big words though. It makes you sound smarter than you are. It should not be that tough. You seem to have no clue what Jorgenson considers embedded taxes and compliance costs. I have seen some caculations for compliance costs, and most have nothing to do with actual costs to businesses.