BY LAURENCE M. VANCE 
Tax season is winding down once again, but the progressivity of the tax code is still with us. Most Americans who had more taxes withheld from their paychecks than they owe in taxes have already filed for their refunds. But not only did many Americans have no tax liability, some of them who didn?t owe any taxes to begin with still received a refund, all thanks to our Marxist tax code.
At the end of section two of Marx?s Communist Manifesto, in addition to calling for the abolition of private property and the centralization of the means of production in the hands of the state, he petitioned for ?a heavy progressive or graduated income tax.?
This is based on the Marxist dictum (that many Americans think appears in the Constitution): ?From each according to his ability, to each according to his needs,? and on Marx?s mistaken notion of the result of the inequality of wealth, as we see in his Das Kapital: ?In proportion as capital accumulates, the lot of the labourer, be his payment high or low, must grow worse?. Accumulation of wealth at one pole is at the same time accumulation of misery, agony of toil, slavery, ignorance, brutality, mental degradation at the opposite pole.?
Yet, from its very beginning, the U.S. tax code has sought to soak ?the rich? with ?a heavy progressive or graduated income tax.?
The income tax began with a 1 percent tax on taxable income above $3,000 followed by a series of surcharges of up to 6 percent applied to higher incomes. The maximum rate of 7 percent was applied to taxable income over $500,000. In addition, there was an exemption of $3,000 for a single person and $4,000 for a married couple.
The tax rate in the highest tax bracket rapidly increased, up to 67 percent in 1917 and 77 percent in 1918, and then rose to 81 percent in 1940, 88 percent in 1942, and a whopping 94 percent in 1944. In 1942, the top rate began applying to all incomes over $200,000 instead of $5 million as it had previously. After dropping briefly, the top rate stayed near or above 90 percent between 1950 and 1963.
Under President Reagan, the top marginal tax rate fell from 70 down to 50 percent, and then down to 38.5 before stopping at 28 percent. The tax brackets were also eventually reduced to just two. This doesn?t mean that the government cut spending and balanced its budgets during the 1980s like it should have, or that it didn?t raise other taxes like it shouldn?t have, but the fact remains that the highest tax bracket fell to under 30 percent for the first time since 1931.
After both rates and brackets increased during the Bush Sr. and Clinton years, the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA) and the Jobs and Growth Tax Relief Reconciliation Act of 2003 (JGTRRA) gave us our current system of six brackets of 10, 15, 25, 28, 33, and 35 percent. The lowest bracket was scheduled to be eliminated, and four of the other rates were scheduled to rise, giving us five brackets of 15, 28, 31, 26, and 39.6 percent, were it not for the two-year extension of the Bush tax cuts enacted at the end of 2010.
But although the tax brackets have fallen in number and amount since their height in the 1960s, this does not mean that ?the rich? have stopped paying their ?fair share.?
According to the most recently released IRS data, in tax year 2009, the top 1 percent of taxpayers (in terms of adjusted gross income) paid 36.73 percent of all federal income taxes. The top 5 percent of taxpayers paid 58.66 percent. The top 10 percent of taxpayers paid 70.47. The top 25 percent of taxpayers paid 87.3 percent of the taxes, and the top 50 percent paid a whopping 97.75 percent.
Read More
Latest Economy
- Hot Dog Vendor Shut Down "To Protect Existing Restaurants From Competition"
- Regulators Take on the E-Book
- Speak No Evil of the Fed, Decrees Keynesian High Priest Paul Krugman
- Don't Catch Recovery Fever
- 19 Signs Of Very Serious Economic Trouble On The Horizon
- Dr. Marc Faber: Global Central Banks Are In The Money Printing Business--There Will Be More QE
- Obama's Pretzel Logic
- Peter Schiff - The Fed Unspun: The Other Side of the Story
This site contains copyrighted material the use of which in some cases has not been specifically authorized by the copyright owner. Such material is made available for the purposes of news reporting, education, research, comment, and criticism, which constitutes a 'fair use' of such copyrighted material in accordance with Title 17 U.S.C. Section 107. If you wish to use copyrighted material from this site for purposes of your own that go beyond 'fair use', you must obtain permission from the copyright owner. It is our policy to respond to notices of alleged infringement that comply with the Digital Millennium Copyright Act (found at the U.S. Copyright Office) and other applicable intellectual property laws. It is our policy to remove material from public view that we believe in good faith to be copyrighted material that has been illegally copied and distributed by any of our members or users.
About Us - Disclaimer - Privacy Policy
"Men occasionally stumble over the truth, but most of them pick themselves up and hurry off as if nothing ever happened..." - Winston Churchill
