Just what is the ideal marginal tax rate?
In this column, Charles Whelan takes on the notion that decreasing tax rates can result in more revenue for the government.
His argument goes like this: if taxes were 99%, or even 70%, or maybe even 50%, the theory would be good, but since the marginal tax rate is 36%, that's already low enough that lowering it any lower does not much expand the tax base.
Whelan offers no analysis whatsoever that 36% is low enough, rather he appeals to the fact that it's not 99%, or as high as other places, as being proof that 36% is plenty low. Bogus logic.
Well Mr. Whelan, I'd like to suggest that the ideal marginal income tax rate, the rate which will maximize government income, is around 25%. Somewhere short of 30%. That's the rate at which industrious people will attempt to maximize their income regardless of taxes. Do I have proof? Not. But as a taxpayer, this is how I feel, and I'm generalizing my feelings to other productive people.
That's more proof than Mr. Whelan offered.
His argument goes like this: if taxes were 99%, or even 70%, or maybe even 50%, the theory would be good, but since the marginal tax rate is 36%, that's already low enough that lowering it any lower does not much expand the tax base.
Whelan offers no analysis whatsoever that 36% is low enough, rather he appeals to the fact that it's not 99%, or as high as other places, as being proof that 36% is plenty low. Bogus logic.
Well Mr. Whelan, I'd like to suggest that the ideal marginal income tax rate, the rate which will maximize government income, is around 25%. Somewhere short of 30%. That's the rate at which industrious people will attempt to maximize their income regardless of taxes. Do I have proof? Not. But as a taxpayer, this is how I feel, and I'm generalizing my feelings to other productive people.
That's more proof than Mr. Whelan offered.
posted by dwshelf at 8:13 AM
0 Comments:
Post a Comment
<< Home