Yep, I’m quite familiar with all tax rates, thank you very little.
Excellent. We’re making progress.
High marginal tax rates in the US (rates between WW1 and Reagan, for higher or lower, usually higher) have the following characteristics which many people do not understand or even know:
- They were vetted only upon extremely high incomes. For example, for much of the time that the highest marginal rates were 90%, the AGI that paid those rates was (in real dollars) about $2,000,000. So, they applied only to a tiny handful of people, because……
- ……the tax code was also loaded with tax breaks that allowed the rich to lower their AGI’s substantially. So, a person who actually MADE that $2M a year (inflation adjusted) might only be paying taxes on a couple of hundred thousand.
Net result: Almost no money was received into Treasury due to those high marginal rates.
So, here’s the question I’ve asked every single person who has tried to claim, either directly or peripherally, that tax rates make a substantial contribution to income inequality based on the US tax history, over the last two decades. And I’m still waiting for an answer:
Please explain how high tax rates that nobody paid and therefore was never received into the government coffers was then redistributed to the lower income groups to account for the lower income inequality during that period.
I suggest, Jack, you not decide to die on that hill.