This Monday is the deadline to file your taxes. As such, this is the time of year for people to complain about how taxes are too high, about how we shouldn't even think about raising taxes, and so forth. However, if you look at the facts, our tax rates are quite low by historical standards. Posted on the IRS website is a table of historical tax rates for the past 100 years (if you don't have Microsoft Excel, you can view the same information here).
As you can see, the highest tax rate in 2010 is 35%. However, prior to the Reagan tax reforms, the highest rate often was above 50%. In fact, there was a period of time when the highest rate was as high as 91%. Obviously, this isn't a true measure of how much a person paid in taxes, because there were all sorts of tax shelters and other "tricks" that people used to keep their tax bill down. Still, it is amazing to think that people are complaining about raising the highest tax rate from 35% when there was a long stretch of time when it was much, much higher. With a 50% top tax rate, the sky didn't fall. Somehow the United States still managed to maintain its superpower status. I think we could handle an expiration to the Bush tax cuts as this would raise the top tax bracket to "only" 39.6%.
Star Money Articles for the Week of May 22
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