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Trivia Tidbit of the Day: Part 845 -- Tax Hikes A-Comin' Our Way.

The Art Of The Laffer Curve-

Art Laffer has an important take on tax rates and tax payments in the Wall Street Journal:

Since 1978, the U.S. has cut the highest marginal earned-income tax rate to 35% from 50%, the highest capital gains tax rate to 15% from about 50%, and the highest dividend tax rate to 15% from 70%. President Clinton cut the highest marginal tax rate on long-term capital gains from the sale of owner-occupied homes to 0% for almost all home owners. We've also cut just about every other income tax rate as well.

During this era of ubiquitous tax cuts, income tax receipts from the top 1% of income earners rose to 3.3% of GDP in 2007 (the latest year for which we have data) from 1.5% of GDP in 1978. Income tax receipts from the bottom 95% of income earners fell to 3.2% of GDP from 5.4% of GDP over the same time period.

The entire semantical/linguistic argument in the establishment media right now regarding the near-term future of tax rates in America hinges on the tax "cuts" for the "rich" "expiring" or going back to "normal."

For those of us in our twenties and even early thirties, we have only paid taxes under the "Bush tax cut" rates. For us, when the rates go up-- as they will under Obama and the Democrats on January 1, 2011-- that is absolutely a tax hike. No ifs, ands, or buts about it.

It will be the largest tax increase in American history, and it will happen at precisely the worst time possible for our struggling national economy.

No amount of passive-aggressive semantical gymnastics by the Democrats can change that reality.

Previous Trivia Tidbit: America's Economy Would Be Far Worse Without Texas.

Posted by Will Franklin · 2 August 2010 11:23 AM

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