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true, the effectiveness of this scheme was slowly eroded beginning shortly after it was enacted. '86 was the knife blow that killed it for good with it's "reven
by mathiasben 9y ago
true, the effectiveness of this scheme was slowly eroded beginning shortly after it was enacted. '86 was the knife blow that killed it for good with it's "revenue neutral" rebalancing of the "loopholes" and deductions available for reinvestment tax treatment.
- WalterBright 9y agoThe reinvestment tax treatments you mentioned were more conventionally known as "tax shelters". People structured their income around tax shelters. Tax shelters tended to be crummy investments that only made sense when considering the tax savings. By eliminating the tax shelters and correspondingly lowering the tax rates, Reagan brought about much more efficient allocation of investment capital.