Top U.S. Marginal Tax Rates Over Time

Helpful graphic on marginal tax rates over time:

Tax rates


  1. Is there any argument to be made that excess private liquidity – which could be drained off into public infrastructure or other projects – is actually correlated to financial bubbles?

  2. The problem with these comparisons is they are not apples to apples comparisons. For instance, in the 50's where it shows people paying 90 cents on the dollar in taxes we had a much different tax code than we have now. There were more loopholes and other ways to shelter income that are not available now. Why then was it necessary to invent the ATM tax which was designed to capture about 20 people when it was passed and now traps millions of tax payers even with the annual charade of changing it every year. To post this graph without these caveats is just plain dishonest and not helpful to the ongoing discussion as to what is the proper amount a government should be taxing it's citizens – Especially when about half (50%) of those citizens pay not income tax at all!

    • Paul Kedrosky says:

      True enough. It would be more useful to show the effective tax rate, loopholes in, as well as the participation rate in tax system.

      • mechawreck says:

        These kind of simplified progressive-vision charts drive me nuts – there are more complexities than even these adjustments previously mentioned. What brackets (levels) actually paid these top brackets? Being in this vilified ">250K" millionaires/billionaires (Obamaworld) AGI bracket probably meant something 20 years ago. Federal taxes only – try joining us in NYC tax and layer on another 12-13% (increasingly not even deductible at the federal level). With the AMT if NY taxed us at 40% (bear with me), you would have to borrow money to pay the IRS – or put another way would be forced to quit. The tax code is so screwed up and federal "revenue" (sic) dependent on a shrinking few – it is really that group of people that is TBTF as the DC leech could not survive even one year's cardiac arrest of the host.

    • eric hinson says:

      not productive for a society to tax those living below the poverty line, the problems created cost the u.s. more money than the revenue collected.

  3. It would also be interesting to see the dollar amount of the top threshold was over time, adjusted for inflation. Seems like it has jumped between $200k and $5MM in the last 90 years:

  4. Also interesting that despite the fluctuation in income tax rates, federal revenue receipts have been consistently between 15-20% of GDP for the last 60 years:

  5. The Department of Numbers website as two interesting graphs that show total US tax revenue as a percentage of GDP. It implies that overall income tax rates have been fairly constant over the last fifty years while corporate income tax rates have been dropping. The data does not answer the questions about top marginal tax rates, but does give some idea of what has been happening on the revenue side.

    • Silver Ace says:

      You also have to take into consideration that GDP is not a great measure of actual productivity. I would say that today, GDP greatly overstates productivity relative to the past.

  6. Here's a different version of the chart, which includes the marginal rate for the bottom bracket: