Because of the recent Republican tax cuts, we have entered an era of perpetual trillion-dollar federal deficits. It’s time we stopped this nonsense and put our economic house in order.
So, how do we get back into balance? Let’s play with some numbers.
In 2016, the latest year for which we have numbers, 1,408,888 tax returns were filed by the top 1 percent. Their total adjusted gross income (AGI) was roughly $2 trillion. Increasing their effective tax rate from 27 percent to 40 percent would add $260 billion to our revenues.
The next 4 percent of tax returns totaled 5,635,551 returns, with total AGI of $1.57 trillion. Increasing their effective tax rate from 19 percent to 35 percent would add $251 billion to our revenues.
The next 5 percent of tax returns total 7,044,440, with a total AGI of $1.16 trillion. Increasing their effective tax rate from 14 percent to 30 percent would add $186 billion to our revenues.
Corporate profits are about $8.8 trillion annually. Increasing the corporate tax rate by 10 percent would bring in $880 billion in additional revenue.
Making these changes would increase our revenue by $1.58 trillion. This would erase our deficit and make funds available for other critical priorities, such as infrastructure, health care and paying down the debt. And the rich would still get richer.
Roger Terry, Orem
