Quotation of the Day…

by Don Boudreaux on October 10, 2014

in Inequality, Myths and Fallacies, Taxes

… is from pages 27-28 of James Piereson’s 2014 monograph, The Inequality Hoax:

Piketty implies that reductions in taxes over the past three decades have allowed the rich to accumulate money while avoiding paying their fair share of taxes.  Nothing could be further from the truth.  As income taxes and capital-gains taxes were reduced in the United States beginning in the 1980s, the share of federal taxes paid by “the rich” steadily went up.  From 1980 to 2010, as the top 1 percent increased their share of before-tax income from 9 percent to 15 percent, their share of the individual income tax soared from 17 percent to 39 percent of the total paid.  Their share of total federal taxes more than doubled during a period when the highest marginal tax rate was cut in half, from 70 percent to 35.5 percent.  The wealthy, in short, are already paying more than their fair share of taxes, and the growth in their wealth and incomes has had nothing to do with tax avoidance or deflecting the tax burden to the middle class.


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