Tax experts are refuting a recent New York Times article claiming the current top tax rate of 39.6 percent is too low.
The article by David Leonhardt explains top marginal tax rates for the highest earners were once a high of 91 percent. Under Lyndon Johnson, the rate was lowered to 70 percent. Under Ronald Reagan it was lowered to 50 percent. The rate has ranged from 30 to 40 percent since 1987.
“When [George] Romney said no to bonuses, the top marginal tax rate was 91 percent,” Leonhardt wrote. “Even if he had accepted the bonuses, he would have kept only a sliver of them.”
Not mentioned by Leonhardt is the fact that high-earners routinely used tax shelters and other means to avoid paying the top rate. In 1960, for example, only eight Americans paid the top rate of 91 percent, according to economist Larry Lindsey.
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