How has the structure of the personal income tax changed and the share of taxes paid by various income groups changed in recent decades?
Compared to the 1960s and 1970s, the marginal tax rates imposed on those with the highest earnings are now substantially lower. However, even though they now confront lower marginal rates, the share of the personal income tax collected from high income taxpayers is now substantially greater than was true prior to 1980 . Because they are now permitted to keep a larger share of their additional income, those with high incomes now have a greater incentive to earn. As they earn more, the revenue losses from the rate reductions are at least partially offset. At the same time, both the personal exemption and standard deduction have been increased. This helps low income taxpayers substantially, and in many cases, it completely eliminates their tax liability. Thus, compared to the 1960s and 1970s, a larger share of the personal income tax revenue is now collected from those with the highest incomes (for example, the top 1 percent of earners) and a smaller share from the bottom half of earners.
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Which of the following statements about profit maximizing firms in a competitive market is FALSE?
A) Firms earn no economic profit in the long run. B) Marginal revenue does not have to equal marginal cost. C) p - MC = 0. D) Price equals marginal revenue.
If the Fed increases the money supply, then: a. the interest rate declines and the quantity of money demanded increases
b. the interest rate declines and the quantity of money demanded declines. c. the interest rate increases and the quantity of money demanded increases. d. the interest rate increases and the quantity of money demanded declines. e. the interest rate increases but the quantity of money demanded remains unaffected.
Suppose that there are only two fishermen, Zach and Jacob, who fish along a certain coast. They would each benefit if a lighthouse were built along the coast where they fish. The marginal cost of building each additional lighthouse is $150. The marginal benefit to Zach of each additional lighthouse is 90 - Q, and the marginal benefit to Jacob is 40 - Q, where Q equals the number of lighthouses. What is the efficient number of lighthouses?
What will be an ideal response?
Economists define inflation as
a. The price of necessities like food and gasoline. b. How fast on average prices are rising in a given period of time c. The value of the dollar d. Average house prices in a given area