...or are they? No one LIKES paying taxes, but most of us understand their necessity. Anyway, I've seen a lot of moaning lately from some of my friends about high tax rates, so I thought I share some facts. I found this article in Business Insider
- Today's income tax rates are strikingly low relative to the rates of the past century, especially for rich people. For most of the century, including some boom times, top-bracket income tax rates were much higher than they are today.
- Contrary to what some would have you believe, super-high tax rates on rich people do not appear to hurt the economy or make people lazy: During the 1950s and early 1960s, the top bracket income tax rate was over 90%--and the economy, middle-class, and stock market boomed.
- Super-low tax rates on rich people also appear to be correlated with unsustainable sugar highs in the economy--brief, enjoyable booms followed by protracted busts. They also appear to be correlated with very high inequality. (For example, see the 1920s and now).
- Periods of very low tax rates have been followed by periods with very high tax rates, and vice versa. So history suggests that tax rates will soon start going up
And before you protest that INCOME taxes may be low, but the government is now gouging us a thousand new ways, note that total government tax revenue (federal, state, and local) is actually now lower than pretty much any time in the last 40 years.
So, what does the future hold? Obviously, no one likes tax increases, but the similarities between the 1920s-1930s and the 2000s-2010s seem hard to ignore. Today, after an era of very low taxes, we have enormous inequality and a huge deficit. Last time that happened, the top tax rate soared (and, it should be noted, the economy boomed--even with the top rate high). And we certainly wouldn't be surprised to see history repeat itself again..."
Read more: http://www.businessinsider.com/history-of-tax-rates?op=1#ixzz2cpamU6Pt