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Saturday, 18th September 2010

The High-Income Rate Reductions: The Neglected Stepchild of the Bush Tax Cuts

The High-Income Rate Reductions: The Neglected Stepchild of the Bush Tax Cuts
Source: American Enterprise Institute

Congress is considering allowing the Bush tax cuts' rate reductions for high-income households to expire at the end of 2010 while providing a deficit-financed extension of the middle-class portion of the tax cuts. This combination would damage economic growth by hiking marginal tax rates on saving and investment while swelling the budget deficit. The vulnerable state of the high-income rate reductions is largely due to the failure of supporters of the Bush tax cuts to make the economic-growth case for these reductions.


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