This blog series and our new report have shown that tax increases on high-income people of the magnitude under consideration would not change their behavior in ways that would hurt economic growth. Moreover, the revenues from tax increases can reduce the deficit or fund investments that support growth.
In this blog series, and in our new report, we've considered how raising taxes at the top might affect economic growth. We've found no convincing evidence that raising taxes at the levels that policymakers are considering would negatively affect high-income people's reporting of taxable income, the amount they work, their saving and investment, the health of small businesses, or the rate of entrepreneurship.
This blog series looks at how tax increases at the top affect economic growth. Today, we test claims that raising taxes on high-income people would heavily and adversely affect small businesses and entrepreneurs.
The second installment in this series on how tax increases at the top might affect economic growth noted that changes in tax rates don't substantially affect high-income people's decisions about how much to work.
The first installment in this series on how tax increases at the top might affect economic growth explained that while high-income people reduce their taxable income in response to tax hikes, that's more because they adopt tax avoidance strategies than because they work, save, or invest less.
This blog series, based on a major new CBPP report, will look at the different ways in which raising taxes on high-income people might affect economic growth, starting with its impact on their taxable income.