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 ...
I’ve never liked that phrase, I wish it were true.
That only "limousine liberals" can set up tax free foundations or are you just being sarcastic?
Because there are still lots of investment ventures that will shelter the wealthy's income so their lower incomes from them will drop their tax obligations down into the lower tax brackets.
Most, if not all, wealthy people already do this to legally avoid paying taxes in the higher brackets.
If they don't have tax advisors and accountants that counsel this type of behavior, they need to seek other advice.
I'm no where near wealthy and I do it on my three small businesses. I expense as much as I can legally through them, which lowers my AGI and therefore the taxes I owe.
My dad who met Mr. Benny while on leave during WWII, was invited to a feast at Mr. Benny home. Mr. Benny had hundreds of brave fighting men that day. Dad said that the food, and booze available was never ended. Dad found out that Mr. Benny did the same thing every day of the week. Mr Benny was a great American.
Free Helo rides.
California had a part time legislature until 1967. That system attracted fewer crooks and socialists than the full time one that we have had ever since.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.