This is a distortion of what actually happened. The reason why there was a massive expansion of benefits granted to top employees in the mid 20th Century is exa

This is a distortion of what actually happened. The reason why there was a massive expansion of benefits granted to top employees in the mid 20th Century is exactly because the 90% taxes on income over $100,000 (adjusting for inflation, roughly $1.6 million in today's money) -- and this was necessary because that $100,000 limit felt real to the employees. This is when the era of travel on corporate expenses became lavish, because it was a tax-free way to offer an extra gift to top employees. If a company can not pay its top executives more than $100,000, then the company might as well put together a lavish bash in Las Vegas -- this can function both as a sales opportunity, but also a way to reward top employees, since the company can not really offer them more cash. If you like, you can refer to the growth of benefits as a tax shelter, but that distorts the original meaning of the word. The big era of tax shelters, in the regular sense, does not get going till the end of 1960s, and then goes wild in the 1970s, then comes to an end in the 1980s (with obvious exceptions such as "horse farms" which allow the rich to avoid paying real estate taxes, while also enjoying their horses). But during the first 30 years of those high taxes, from the 1930s to the 1960s, those high nominal rates lead to high real tax rates. This is the main reason that income inequality shrank dramatically during this time. Read the vicious attacks that the wealthy expressed towards these high taxes and you realize that these high taxes were very real.