Pros And Cons Of The Tax Reform Act Of 1986

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A. Policy The Tax Reform Act of 1986 (Winfrey 2016) sponsored by two Democrats, Representative Richard Gephardt of Missouri and Senator Bill Bradley of New Jersey. The goal was to make the tax code easier and widen the tax base. President Reagan signed the Tax Act on October 22, 1986. The macroeconomic problem being address is, The Tax Reform Act of 1986 did not significantly reduce the number of tax expenditures. (McBride 2013) The Tax Reform Act of 1986 lowered the top tax rate from 50 percent to 28 percent and raised the bottom tax rate from 11 percent to 15 percent from 1986-1991. (McBride 2013) B. Political Impact In 1986, President Reagan worked with Congressional Democrats and Republicans to pass tax reform that resulted in a revitalized…show more content…
Policy Evaluation The pro or benefit for this policy is the lowering of top tax rate from 50 percent to 28 percent. (Radman and Walsh 2013) It provided Social Security numbers for each child on their tax returns and it expanded the Alternative Minimum Tax and increased the Home Mortgage Interest Deduction to incentivize homeownership. The United States needed to look at the future of the Tax Act that has come together to see if it will be beneficial to the citizens of the United States. Second I believe it was great that the Republican Party and the Democratic Party could come together a little more and work more out, because I believe with both parties of the government working together it will give citizens of the United States more trust, because there is no fight around between the parties. When discussing economic outcomes, all social classes should be evaluated with this, because it is the social classes that make up the U.S. economy. If this tax act ends up affecting the social class, then you can have a harmful decline in your economy which no one…show more content…
"This Day in History: President Ronald Reagan Signs the Tax Reform Act of 1986." Americans for Tax Reforms. October 22, 2013. Accessed September 22, 2016. https://www.atr.org/history-president-ronald-reagan-signs-tax-a7946. Winfrey, Frank. "Tax Reform Act of 1986." Encyclopedia Britannica Online. December 5, 2013. Accessed September 22, 2016. https://www.britannica.com/topic/Tax-Reform-Act. McBride, William. "A Brief History of Tax Expenditures." Tax Foundation. August 22, 2013. Accessed October 22, 2016. http://taxfoundation.org/article/brief-history-tax-expenditures. Kamarck, Elaine, and James Pinkerton. "Tax Reform Lessons from 1986." TheHill. August 27, 2012. Accessed October 24, 2016. http://thehill.com/blogs/congress-blog/economy-a-budget/245581-tax-reform-lessons-from-1986. Atkins, Chris. "Tax Reform and Revenue Neutrality: President 's Panel Should Avoid the Redistribution of 1986." Tax Foundation. July 13, 2005. Accessed October 25, 2016.

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