When we look at the distribution of income vs. tax receipts by type, however, we see that despite the fact that capital income is by far the primary form of income for the wealthiest Americans, the tax burden falls disproportionately on income from labor. As of 2004 the form of income that is most heavily concentrated among the wealthy was taxed the least, while the form of income that was dominant among working class Americans is taxed the most. This has actually been the case ever since the so-called Reagan Revolution. The extent to which capital income was taxed in relation to income from labor fluctuated in America throughout the 20th century, but for most of the 20th century it was agreed that it was unfair to tax unearned income, i.e. income from capital, at rates significantly lower than earned income, or income from labor. The tax burden on capital was significantly reduced during Reagans presidency and has been reduced further since his presidency in following with the trends established during the Reagan Revolution. Share of capital income received by top 1% and bottom 80%, 1979-2003
Posted on: Sat, 28 Jun 2014 01:54:20 +0000
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