62%! After the landmark Tax Reform Act of 1986, which closed special-interest loopholes in exchange for top marginal rates of 28%, the highest combined federal-state marginal tax rate was about 33%. Now we may be headed to 62%. You don’t have to be Jack Kemp or Arthur Laffer to understand that a 29 percentage point rise in top marginal rates would make America a highly uncompetitive place.
No automatic Tax Rate/Revenue connection There is no automatic correlation between the direction in which tax rates move and the direction in which tax revenues move. Nor is this a new discovery.
