Comments by "Matt Foley" (@mattfoley6082) on "Supreme Court to hear arguments on Biden's vaccine mandate" video.
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@DONALD-MAGA The Reagan Tax Cut, also known as The Economy Recovery Tax Act of 1981, was huge during the 1980s. The provision aimed a 23% cut in individual income tax rates over three years. This brought the high marginal tax rates — the highest ever — from 70% to 50%. At the time, the inflation rate was nearly 10%.
Accordingly, the tax cut wasn’t able to pay for itself. The Reagan administration thought the spending cuts did not materialize. While the recession ended during that time, it is believed that the monetary policy concluded it, not the tax provisions. In fact, that time, the federal reserves went down by about 9% in the first two years since its regulation.
Effects of This Tax Cut to Individuals and Businesses
The tax cut was so huge that it hugely increased the national debt and blew up budget deficits. As a result, with Reagan’s signature, Congress had to undo the tax cut by increasing tax rates from 1982 through 1987 for economic recovery. Shortly after, George H.W. Bush and Bill Clinton had to do the same in 1990 and 1993, respectively. It has been learned from this tax history that tax cuts are extremely challenging to sustain and often implies future massive increase in taxes.
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