Through reducing marginal tax rates, the program aimed to combat the combination of high unemployment and stagflation. In 1986, The Tax Reform Act cut the tax brackets to four while reducing the average individual income tax rate by around 6%. The reform also increased corporate taxes due to growing fear over the increasing budget deficit. However, critics argued that the tax reforms led to great inequality between the income of the wealthy and the middle class. Another negative result of the tax cuts was that they led to a dramatic increase in deficit spending. The tax cuts introduced by Reagan in the early 1980s inevitably led government revenue which no longer could support spending regarding the military or social policies. The result was the largest deficit in US
Through reducing marginal tax rates, the program aimed to combat the combination of high unemployment and stagflation. In 1986, The Tax Reform Act cut the tax brackets to four while reducing the average individual income tax rate by around 6%. The reform also increased corporate taxes due to growing fear over the increasing budget deficit. However, critics argued that the tax reforms led to great inequality between the income of the wealthy and the middle class. Another negative result of the tax cuts was that they led to a dramatic increase in deficit spending. The tax cuts introduced by Reagan in the early 1980s inevitably led government revenue which no longer could support spending regarding the military or social policies. The result was the largest deficit in US