Last month I talked a little about the President-Elect’s plan to cut taxes in America. That includes a “35% tax cut” for middle-class families as well as a massive reduction in the corporate income tax rate from 35% to 15%. In that article I referenced the country’s history of such changes, which showed that in general, tax rate changes do not usually result in significant changes in taxes collected. Over the last 70 years, the percentage of taxes as a percentage of U.S. Gross Domestic Product has generally been in the range of about 16% to 18% (see graph below).
David A. Pace, CFA
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