Thursday, October 6, 2011

US Needs More Millionaires, Not More Millionaire Taxes

The US needs economic growth policies from the President and Congress and not a millionaire's surtax. The number of millionaire tax returns dropped 40 percent between 2007 and 2009 (latest data) and millionaire reported income (AGI) dropped by 50 percent.

From The Tax Foundation, The Tax Policy Blog, "How Do You Tax a Millionaire? First, You Get a Millionaire" by Scott A. Hodge:
Recent IRS data for 2009 indicates that the recession did more to reduce the number of millionaires than any surtax. Comparing the 2009 data to the pre-recession data for 2007 shows that not only did the number of millionaires fall by 40 percent, but the overall income of millionaires fell by 50 percent. The result for the U.S. Treasury was that 54 percent of the total drop in tax revenues during this period was due to the falling tax collections from millionaires.
The lesson from this IRS data is that we don't need higher tax rates on millionaires to collect more tax revenues from them. We need economic growth to create more millionaires. Once we have more millionaires, the tax collections will take care of themselves. [Emphasis Added].
Read the complete post, along with charts and data, here.

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