90% AIG Tax Rate: Back To The 1950s

Dave Prychitko: The latest move to tax the bonuses at AIG (AIG) is an attempt to bring about, essentially, a new marginal tax rate of 90%. We haven’t seen that since the 1950s and early 1960s in the U.S. (see chart above, data here). The difference here between today’s proposal and that of the past is that it is targeted not toward a general class of income earners in general, but to bonus-earners (non-earners?) at a particular corporation.

MP: In the chart above, notice the huge increases in marginal tax rates during the 1930s, from 25% in 1931, to 63% in 1932, to 79% in 1936.

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