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The phrase Reagan tax cuts refers to changes to the United States federal tax code passed during the presidency of Ronald Reagan. There were two major tax cuts: The Economic Recovery Tax Act of 1981 and the Tax Reform Act of 1986 .
The Economic Recovery Tax Act of 1981 (ERTA), or Kemp–Roth Tax Cut, was an Act that introduced a major tax cut, which was designed to encourage economic growth. The Act was enacted by the 97th Congress and signed into law by U.S. President Ronald Reagan.
Offsetting these cuts, the act increased the alternative minimum tax and eliminated many tax deductions, including deductions for rental housing, individual retirement accounts, and depreciation. Although the tax reform was projected to be revenue-neutral, it was popularly referred to as the second round of Reagan tax cuts (following the ...
The two acts together are known as the Reagan tax cuts. When Reagan took office, the top rate was 33% higher than it is today (37%), and when he left office, it was 9% lower. Bill Clinton, 1993-2001
In 1982 Reagan agreed to a rollback of corporate tax cuts and a smaller rollback of individual income tax cuts. The 1982 tax increase undid a third of the initial tax cut. In 1983 Reagan instituted a payroll tax increase on Social Security and Medicare hospital insurance. [25] In 1984 another bill was introduced that closed tax loopholes.
The 2017 Tax Cuts and Jobs Act, signed by President Trump, was the most recent major overhaul to the IRS tax code. The legislation lowered taxes for 65% of American households, according to ...
Reagan sought to stimulate the economy with large, across-the-board tax cuts. [ 5 ] [ 6 ] The expansionary fiscal policies soon became known as " Reaganomics ", [ 5 ] and were considered by some to be the most serious attempt to change the course of U.S. economic policy of any administration since the New Deal .
To ensure that wealth would be a long-lived family entitlement, Reagan instituted a 300% increase in inheritance tax protections through estate tax exemptions in his first budget. In 1980, the ...