If a tax rate was at 92 percent (like Eisenhower) does that mean 92 cents for every dollar goes to the govt?

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3 Answers

Cool Spot Profile
Cool Spot answered

Some of the money is going to go to some private company.

Maurice Korvo Profile
Maurice Korvo answered

That was the tax rate  for people who made more than 400.000 a year back then. For every dollar they made, they paid 92 cents to the Gov. Now its about 35 cents for each dollar. (But there were ways around that tax, like putting it into long term investments etc. It was to encourage the high earners to put the money back into the hands of the people)

K. B.  Baldwin Profile
K. B. Baldwin answered

Back then there were so many deductions that no one except the terminally stupid paid 92%. 

thanked the writer.
Maurice Korvo
Maurice Korvo commented
$0.92 of every $1.00 went to the government, unless you invested it in a company or an investment of some kind. So the rich were forced to keep the economy growing. The tax on capitol gains was not nearly that much! Tax on capitol gains was never more than 25%. So you invested your $400,000 in wages, and lived off capitol gains. Great for making the economy boom. Which is what it did in the 50's and early 60's.

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