When the nonpartisan Congressional Research Service issued a report that found high-income tax cuts have little impact on economic growth, Republicans attempted to spike it. The CRS ultimately pulled the report, but after revising some language, clarifying its methodology, and adding more citations, CRS re-issued the report Thursday.
The new report’s findings, unsurprisingly, are the exact same. Lowering income tax rates and the rate on capital gains investment income hasn’t helped economic growth, but it has resulted in more income inequality:
The results of the analysis in this report suggest that changes over the past 65 years in the top marginal tax rate and the top capital gains tax rate do not appear correlated with economic growth. The reduction in the top statutory tax rates appears to be uncorrelated with saving, investment, and productivity growth. The top tax rates appear to have little or no relation to the size of the economic pie. But as a small proportion of taxpayers are affected by changes in the top statutory tax rates, this finding is not unexpected.
However, the top tax rate reductions appear to be correlated with the increasing concentration of income at the top of the income distribution.
Both the Congressional Budget Office and International Monetary Fund have issued reports that come to similar conclusions. And as these charts from Michael Linden, the director of tax and budget policy at the Center for American Progress show, neither the general supply-side policies favored by Republicans nor the tax cuts for the rich conservatives say are necessary actually lead to faster economic growth: