The maximum rate of income taxation here is 67%. In England it is 42½%. Ours is therefore 50% higher than England’s and the rate in England is the highest prevailing anywhere in Europe. Neither republican France nor democratic England—containing in their cabinets Socialists and representatives of labor—nor autocratic Germany have an income tax rate anywhere near as high as our maximum rate. And in addition to the federal tax we must bear in mind our state and municipal taxes.
2. Moderate and small incomes, on the other hand, are subject to a far smaller rate of taxation here than in England.
In America, incomes of married men up to $2,000 are not subject to any federal income tax at all.
In England the tax on incomes of $1,000 is 4½%
In England the tax on incomes of 1,500 is 6¾%
In England the tax on incomes of 2,000 is 7⅞%
(These are the rates if the income is derived from salaries or wages; they are still higher if the income is derived from rents or investments.)
The English scale of taxation on incomes of, say, $3,000, $5,000, $10,000 and $15,000, respectively averages as follows, as compared to the American rates for married men:
| In England | In America | |
|---|---|---|
| Income tax rate on $3,000 | 14% | ⅔ of 1% |
| Income tax rate on 5,000 | 16% | 1½% |
| Income tax rate on 10,000 | 20% | 3½% |
| Income tax rate on 15,000 | 25% | 5% |
(If we add the so-called “occupational” tax, our total taxation on incomes of $10,000 is 6¾%, and on incomes of $15,000, 9¾%.)