Tax Rates During The Early 1900s

The first chart shows the highest U.S. income tax rate in the history during the 20th century at 94 percent. The second chart shows the amount of revenue the government was receiving from their income taxation. As years goes by, the amount of income tax revenues increases. When tax revenues increases, that means the government is gaining more profit. The government is either receiving more in taxes or spending less in order to have an increase in revenue. When the government spends, there is more money flowing through the economy. The last chart shows the share of taxes that the top 1 percent contributes to our economy. The tax shares of the top 1 percent are around 20 percent. While the top 1 percent earns about 40 percent of the nation’s wealth, they’re only contributing 20 percent of what they’re earning back into the economy. This information is relevant because the share of taxes for the top 1 percent is not proportional considering the amount they’re earning. This doesn’t seem relatively fair to everyone else like the

And while the top rate for a married couple was 7 percent, to reach it they had to make more than $500,000, nearly $12 million in 2014 dollars. In 1913, it raised a grand total of $28 million, a mere $668 million in today’s dollars.”

The data shows that the tax rate during the early 1900s was much lower than the tax rate we have today. This is relevant because the government is taxing more as time passes in order to gain more tax revenues.

- “By 1917, the top federal income tax rate had been raised to 67 percent. Though it fell in the 1920s, it would rise again during the Great Depression and, especially, World War II. In 1940, before the United States entered the conflagration, the federal income tax raised $1.5 billion ($25 billion in today’s money). By 1945, it collected $17 billion ($223 billion). The top income tax rate would not fall below 70 percent again until