Federal Income Tax Reform in the United States

The16th Amendment to the U.S. Constitutionin 1913 provided the legal basis for progressivefederal income taxes.They now yieldrevenuesof about $450 billion annually. Tax base erosion eventually produced a levy in serious violation of norms of allocationefficiency, distributionalequity, and macroeconomicperformance.Vested private interests influenced legislators by propaganda and campaign contributions to minimize their tax burdens at the expense of less wealthy taxpayers. The result was an irrational and badly flawed tax structure. In 1981 the maximum marginal tax rate on income from property and wealth was significantly reduced along with other bracket reductions. The income tax reform movement culminated in 1984 to 1986. It expanded the base of the tax while reducing marginal rates as well as brackets, with little change in the distribution of the burden among different income groups but achieving some greater equity in tax liabilities for those with similar incomes

Dividend tax · Economics · Equity (law) · Gross income · Income tax · Indirect tax · Labour economics · Political science · Public economics · Revenue · State income tax · Tax reform · Tax revenue · Corporate Taxation and Avoidance · Finance · Fiscal Policy and Economic Growth · Gender, Labor, and Family Dynamics · Law

• The Logic of Collective Action

  Mancur Olson•Logic of Collective Action•1965

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