FACT: Reagan INCREASED Taxes On The Rich; Trump Plan Will Be Virtually Opposite

[DonKnock]

According to a 1996 report of the Joint Economic Committee of the United States Congress, during Reagan's two terms, and through 1993, the top 10% of taxpayers paid an increased share of income taxes (not including payroll taxes) to the Federal government, while the lowest 50% of taxpayers paid a reduced share of income tax revenue





Trump's plan:

Top quintile: 31.1 | 27.9 % Change: -3.2%
Top 1 percent: 38.8 | 32.3 % Change -6.55%
Top 0.1 percent: 39.5 | 32.2 %Change -7.3%


"Just before the election, after the last debate, 51 percent of them intending to vote for Trump supported increasing taxes on high-earning individuals," says Michael Pollardof RAND.

But Trump's plan does the opposite, says Lily Batchelder, a law professor at New York University and visiting fellow at the Tax Policy Center.

"If you look at the most wealthy, the top 1 percent would get about half of the benefits of his tax cuts, and a millionaire, for example, would get an average tax cut of $317,000," she says.

 

[keepemup]

I think it's a misnomer to say that he increased taxes on the rich simply because the government was able to take in more money. He reduced taxes, and corporations made more money (not sure if it's directly related to the tax cuts) and they were able to increase the tax coffers.

 

[NkrumahWasRight Is Wrong]

He initially wanted to raise taxes on the rich then switched off it. That was disappointing.

 

[chowism]

So what you going to do about it?

 

[714562]

I think it's a misnomer to say that he increased taxes on the rich simply because the government was able to take in more money. He reduced taxes, and corporations made more money (not sure if it's directly related to the tax cuts) and they were able to increase the tax coffers.

Except it's not a misnomer at all.

Taxes: What people forget about Reagan - Sep. 8, 2010

Two bills passed in 1982 and 1984 together "constituted the biggest tax increase ever enacted during peacetime," Thorndike said.

The bills didn't raise more revenue by hiking individual income tax rates though. Instead they did it largely through making it tougher to evade taxes, and through "base broadening" -- that is, reducing various federal tax breaks and closing tax loopholes.

For instance, more asset sales became taxable and tax-advantaged contributions and benefits under pension plans were further limited.

"What people forget about Ronald Reagan was that he very much converted to base broadening as a means of reducing deficits and as a means of tax reform," said Eugene Steuerle, an Institute Fellow at the Urban Institute who had helped lay the groundwork for tax reform in 1986 and served as a deputy assistant Treasury secretary during Reagan's second term.

There were other notable tax increases under Reagan.

In 1983, for example, he signed off on Social Security reform legislation that, among other things, accelerated an increase in the payroll tax rate, required that higher-income beneficiaries pay income tax on part of their benefits, and required the self-employed to pay the full payroll tax rate, rather than just the portion normally paid by employees.

The tax reform of 1986, meanwhile, wasn't designed to increase federal tax revenue. But that didn't mean that no one's taxes went up. Because the reform bill eliminated or reduced many tax breaks and shelters, high-income tax filers who previously paid little ended up with bigger tax bills.

"Some of these taxpayers were substantial contributors to the Republican Party and to the president's re-election campaign, and had direct access to the White House. Reagan rebuffed their pleas," wrote J. Roger Mentz, the Treasury assistant secretary for tax policy in 1986, in a Tax Notes commentary last year.

All told, the tax increases Reagan approved ended up canceling out much of the reduction in tax revenue that resulted from his 1981 legislation.

Annual federal tax receipts during his presidency averaged 18.2% of GDP, a smidge below the average under President Carter -- and a smidge above the 40-year average today.

 

[FAH1223]

Reagan cut taxes so much the first time, he had to raise em back up