Posted on 01/19/2019 5:35:11 AM PST by reaganaut1
It wasn’t that long ago, in 1980, that America had a top income-tax rate of 70% for individuals, nearly double the current top rate of 37%.
And it wasn’t unusual. From 1940 through 1980 the top rate for the highest earners never dipped below 70%. During most of the 1950s, when the U.S. economy dominated the world, the top rate was 91%. It kicked in at $400,000 of taxable income, or roughly $3.7 million in today’s dollars.
This history is relevant given New York Rep. Alexandria Ocasio-Cortez’s recent call for higher tax rates on what she called the “tippy-tops” to raise more revenue. She suggested that a top rate of 70% could take effect at the $10 millionth dollar of income.
But make no mistake: Many top earners during the high-rate era, such as politicians Dwight Eisenhower and Ronald Reagan, entertainer Jack Benny and librettist Alan Jay Lerner, didn’t pay the top rates. In 1952, for example, when the top rate was 92%, the highest-earning 1% of taxpayers had an average rate of 32%, according to Elliot Brownlee, a tax historian and emeritus professor at the University of California, Santa Barbara.
“When top tax rates were high, there was always a large gap between the stated rates and what the highest earners actually paid as a percentage of their income,” says Joel Slemrod, an economics professor at the University of Michigan.
Of course, a filer’s average tax rate is lower than his top rate because the U.S. system is progressive, taxing higher income at higher rates. Still, the income tax due on $1 million of wages in 1952 would have been about $870,000, according to Jay Starkman, a certified public accountant in Atlanta who researches tax history.
(Excerpt) Read more at wsj.com ...
There were unlimited deductions for depreciation, interest and state and local taxes.
I would be there the day after retiring, were it not for the fact that my wife couldn’t stand the winters.
Absolutely positively my all time favorite comedian.
I always wondered how “ red” states had Rat senators or governors. In Testercle’s case he has the “ yup, I’m just like you ranchers and cowboys cause I’ve got a crew cut and I shoot guns “ look. They’re fakes. Sheesh.
For those who don’t want to subscribe to the WSJ
I’d like to visit.
The spouse would never want to.
The truly wealthy will never lose the tax game. They write the rules.
Mr. and Mrs. Average always did and always will pay the freight.
A flat tax would garner more money from millionaires than trying to gouge them.
Why should all that money be invested in gov’t., which produces nothing but overpaid gov’t. employees? Millions of dollars, in the right hands, can be invested wisely & produce more jobs & wealth for many people who are the real producers in the nation....not the gov’t. Ms. Cortez has little concept of a proper working country. Maybe she needs a low-paying job in the Venezuelan embassy. At least it might be a learning experience.
1. Eliminate ALL corporate tax.
1a. Eliminate ALL depletion allowances and depreciation allowances.
2. Eliminate ALL current IRS regulations.
3. Set the individual tax rate at 10% regardless of income.
3a. Perquisites at taxed at 10% of cost.
3b. Withhold at the rate of 11%, to get a refund you have to file taxes, but there is no legal imperative to file.
4. Tax ALL money coming into the country at 0% (yes, ZERO%).
5. Tax ALL money leaving the country at 11%.
You’ll get more out of the rich at low rates than high rates.
I had a Marxist tell me that Marxism would only work when it is world wide.
I remember when I lived in New Mexico, the heir to the Revlon fortune bought a huge cattle ranch. People wondered how in the heck they made any money on it. It was a money hole from the get-go.
Reality was they didn't want to make any money. They wanted to lose money, lots of it.
That in turn translated to lower income and therefore a lower tax rate.
Wealthy people make enough money to have plenty of options to avoid paying the top rates. States that decide to tap into the wealthy's collective pockets for revenue, many times see their revenue go down because the wealthy are also not stupid. They move to another state where the taxes aren't so onerous. Duh!
It happened in France when that liberal predecessor to Macaroni man, Hollande, ratcheted-up the top rates to 75%. They had to rescind it because all of the smart wealthy residents moved to other countries to avoid the tax. It was a failure of the government "experts".
There are still plenty of loopholes in the US tax code so that if AOC gets her 70% rate or, heaven forbid, Castro gets his 90% rate, that the wealthy will do what they have always done.
They will figure out how to avoid the highest rates and the liberal government programs reliant on these high tax rates for their revenue will fall flat on their faces.
But like someone else on this thread commented, these liberals don't know the first thing about economics, or more important, human nature. People that can, will flee the high tax rates. Why would someone stand still while the government was trying to fleece them?
I seemed to remember reading how Abbot and Costello were zapped by the IRS in what turned out to be a personal grudge held against them by a jealous tax agent.
“Then how do you explain Testor?”
He IS a fool.
Montana has only ever reelected ONE Republican senator in it’s history, and he lost to Testor during the W era.
Our state is run well and efficiently - that’s my point.
Senators that bring home the ‘bacon’ for the agricultural producers get elected and reelected.
Montana DID elect the first female to congress, Jeannette Rankin. Nothing I am proud of, however.
Every state has their embarrassing senators and reps. - at least our state is run efficiently, has no professional legislators and we do have more than $1 billion in cash on hand...
How’s your state doing?
Taxes are, or should be, simply a way to raise operational funds for the government, period.
They should fall equally on the rich, the poor and the middle, every resident of America needs to have some of their own skin in the game.
No politician should ever be able to say "We'll tax those other people, not you!", indeed, if there must be an exception to the rule, it should be that legislators who have the authority to impose taxes are taxed TWICE the rate their sessions impose on the rest of us for life!
You want to reward your cronies? Pass a special one year duration law to give them government funds, make it public, defend it every year. If you can't, they haven't earned a taxpayer funded reward. Defend and pass it or pay them out of your own pocket, or maybe, just maybe, they can earn extra money in the marketplace by offering better goods and services, just like the rest of us must!
Benny was funny. But he was also a real gentleman. As evidence of that, he treated Rochester (Eddie Anderson) as an equal both on and off the air. That was rare in those days. And if a hotel wouldn’t accept Anderson, Benny would move his entire troupe elsewhere.
Nothing is going to change until we get a handle on spending....a genuine balanced budget amendment is the only way to go.!!!!
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