The Tax Policy Center is a non-partisan think tank and joint venture of the Urban Institute and Brookings Institution. The Center focuses on five overarching areas of tax policy: fair, simple and efficient taxation, social policy in the tax code, business tax reform, long-term implications of tax and budget choices, and state tax issues. Its online reports and articles are engaging, accessible and often full of helpful charts. For instance…
Note that individual income tax revenue was below 8% of GDP during the 1950s and early 1960s, when the top marginal income tax rate was over 90%. The top income tax rate has stayed within the narrow range of 35-39.6% since 1987 and yet over the same period income tax revenues have gyrated from 6-10% of GDP.
Now for the real shocker:
Mmmm…remarkably stable for over 60 years despite ongoing fiddling with the tax rates. Speaking of which:
My main take-away is that Trump’s tax cuts haven’t been all that radical - just more tweaking within the historical range of tweaks.