Many people believe our nation’s growing income inequality and our diminishing middle class are fundamental problems facing our society. For the past 40 years or more, America’s per capita Gross Domestic Product (GDP) has steadily grown because our workforce has increasingly produced more goods and services with the same number of workers. However, workers have not been rewarded for this increased productivity. In 2001, wages accounted for about 49% of GDP but this number is now about 43% following a steep and steady decline. Furthermore, it has recently been revealed that 60 Fortune 500 companies paid no federal income taxes on $79 billion in profits in 2018. Rather, they received a combined 4.3 billion in rebates instead. These companies included Amazon, Netflix, Chevron, Delta, GM, Goodyear, Halliburton, IBM, Salesforce, U.S. Steel and Whirlpool, among others. The wealthiest among us, those making more than $400,000 a year, have captured nearly all the economic gains during these past 3-plus decades.

Income tax brackets for individuals also apply to corporations. Although allowed more deductions, a corporation’s gross income is subject to the same federal tax rates as individuals. During President Eisenhower’s administration, the marginal tax rate for Americans in the top income tax bracket was 92% - meaning the wealthiest Americans paid our treasury 92 cents of each dollar they earned. Under Carter the upper tax rate was cut to 70%. Clinton slashed it to 39.6% and Trump took it sown to 37% which is where it is today. The upper income tax bracket today is reserved for those with annual incomes in excess of $518,400.

Pending Legislation: S.1652 - Paying a Fair Share Act of 2021
Sponsor: Sen. Sheldon Whitehouse (RI)
Status: Senate Committee on Finance
Chair: Sen. Ron Wyden (OR)