The government did not start taxing income until 1913... how did we function before that? We didn\'t have these ridiculous government programs and let private businesses handle the load.
Let us be clear. The government didn\'t introduce a permanent federal income tax until 1913.
I agree though. The Federal Government has become so bloated with wasteful spending on useless programs. If the government really wanted to lower taxes they would review the multitude of wasteful programs.
As you will notice the only time tax rates have really spiked is during a global war or depression.
History of top rates
* In 1913 the tax rate was 1% on taxable net income above $3,000 ($4,000 for married couples), less deductions and exemptions. It rose to a rate of 7% on incomes above $500,000.
* During World War I the top rate rose to 77%; after the war, the top rate was scaled down to a low of 25%.
* During the Great Depression and World War II, the top income tax rate rose again. In the Internal Revenue Code of 1939, the top rate was 75%. The top rate reached 94% during the war and remained at 91% until 1964.
* In 1964 the top rate was decreased to 70% (1964 Revenue Act), then to 50% in 1981 (Economic Recovery Tax Act or ERTA).
* The Tax Reform Act of 1986 reduced the top rate to 28%, at the same time raising the bottom rate from 11% to 15% (in fact 15% and 28% became the only two tax brackets).
* During the 1990s the top rate rose again, standing at 39.6% by the end of the decade.
* The top rate was cut to 35% and the bottom rate was cut to 10% by the Economic Growth and Tax Relief Reconciliation Act of 2001 (EGTRRA).
As your can see the top rate was decreased in 1981 to half. Then in 86 to 28 percent. This directly relates to our economic growth through the 80\'s and 90\'s.
