Why did the top US income tax bracket change from over 70% to under 30% in the 1980’s?

Why did the top US income tax bracket change from over 70% to under 30% in the 1980’s?

What do you think?

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  1. Trickle down economic theory

    The idea is that if a wealthy person has less tax burden they can invest that wealth in to more enterprise creating jobs and opportunity for the working class.

  2. I don’t think it went to under 30% — not quite that low. However, along with the marginal rate decreases, they eliminated tons of previously allowed deductions. So the actual change wasn’t as drastic as it sounds.

  3. Why?…to increase tax revenue and cause the top earners to pay more( remove the incentive to hide money rather than pay taxes)…in addition to providing incentive to spur economic growth

    ….and it worked, mostly.

    Tax revenue and the top earners share of that revenue increased dramatically. ( 54% raw increase , 30% when adjusted for inflation.)

    Even today, the vast majority of Americans tax burden is less than it was in 1979-1980…..only the top earners have seen their burdens increase…..and they have increased quite substantially
    In79-80, the top 10% earners share of income tax revenue was 48% …today its over 70%.

    Taken as a whole ( taxation, spending , inflation, growth)it didn’t pan out as advertised.
    Though tax revenues increased, spending did as well. inflation still took out a good chunk, and growth was only spurred in certain sectors ( like the financial sector, which grew dramatically).
    The one solid good was that the lower brackets began to pay less in their tax burden, and that continues today.(with over 50% of earners having no tax burden, or a negative tax burden)

    The Reagan Tax cuts delivered exacrlt what people are still crying for today….make rich pay more, the lower classes pay less , and more money in tax revenues.

  4. The economy really sucked in the 1970s. Jimmy Carter, like Trump, lost reelection because the economy was so bad.

    Trickle down economics. Yeah. People didn’t think the government should not be involved in so many things. The American economy exploded. But people did not benefit equally from this explosion.

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