Another guy has examined the "tax cuts increase revenues" claim and found it false.
Even the often lauded Kennedy tax cut (which cut top rates from 91% to 70%, btw, about where I believe they should be) did not do so, and sometimes the effect of the cut is lumped with the 10% surcharge that was enacted in 1969, which explains 40% of the decade's increase in revenue. A key point is that there was a doubling of revenues in each decade just from economic (and population) growth. The tax cuts did what you would expect--they cut revenues. Obviously Laffer was wrong when he guessed where we were on the tax revenue curve (from Keynes!), and that was with rates of 70%. The point at which tax cuts would be self funding must be way above 70%, maybe even above 91%. Anyway, "above 91%" would be consistent with the data.
Reagans cuts brought the top rate down to 50% in 1981, then to 28% in 1986.
Even the often lauded Kennedy tax cut (which cut top rates from 91% to 70%, btw, about where I believe they should be) did not do so, and sometimes the effect of the cut is lumped with the 10% surcharge that was enacted in 1969, which explains 40% of the decade's increase in revenue. A key point is that there was a doubling of revenues in each decade just from economic (and population) growth. The tax cuts did what you would expect--they cut revenues. Obviously Laffer was wrong when he guessed where we were on the tax revenue curve (from Keynes!), and that was with rates of 70%. The point at which tax cuts would be self funding must be way above 70%, maybe even above 91%. Anyway, "above 91%" would be consistent with the data.
Reagans cuts brought the top rate down to 50% in 1981, then to 28% in 1986.
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