A 92% TAX RATE DOES NOT MEAN THEY KEEP EIGHT CENTS OF EVERY DOLLAR.

JUSTICE · ECONOMIC JUSTICE

Published by Langhorne P. Breedlove

MONDAY, NOVEMBER 9, 2026 · 12:20 AM ET

Tags: Progressive Taxation · Marginal Rates · $5 Million Income · Tax Avoidance · Public Revenue

Dear fellow American proletariat: America is remarkably inventive about taxes. A schoolteacher receives a paycheck with deductions already calculated. A person collecting millions can hire a roomful of professionals to discuss whether the money really arrived, what sort of money it was, and whether it might instead be a tasteful investment in the Cayman Islands. Not every tax strategy is unlawful. That is precisely why writing better law matters.

American Proletariat proposes a 92% top marginal federal individual income-tax rate on taxable income ABOVE $5 million per year. Below that threshold, lower rates apply. The proposal is paired with AP's separate plan for a 0% federal individual income-tax band on the first $80,000, but the intermediate brackets, filing-status treatment, capital-gains rules, and transition schedules still require legislative design. This is a proposed law, not a description of the law in force.

THE MANDATE

A person with exactly $5 million of taxable income would owe no 92% bracket tax under this proposal. A person with $6 million of taxable income would face $920,000 of federal income tax on the ONE million dollars above the threshold, plus whatever liability applies to the lower brackets. That arithmetic is the meaning of a marginal rate. Someone who says we are proposing to confiscate 92% of every wealthy person's entire income has either misunderstood the proposal or found a remarkably inexpensive substitute for reading it.

The $5 million trigger refers to annual TAXABLE income, not net worth, company revenue, household assets, or the market price of unsold stock. How joint returns, pass-through business earnings, realized capital gains, retirement distributions and trusts are handled must be specified in legislation. A wealth tax or a billionaire net-worth cap would be a different proposal with different legal questions.

ROOTS & HISTORY

The Sixteenth Amendment, ratified February 3, 1913, established Congress's authority to levy a federal income tax without apportioning that tax among states (Source 01). The United States later used steeply progressive schedules: the top statutory federal marginal rate reached 94% in 1944–45, 92% in 1952–53, and 91% through much of the 1950s and early 1960s (Source 02). The 92% figure, therefore, is not an invented mathematical species. It has appeared in American law before.

But history demands one more sentence. These were STATUTORY top marginal rates, not what affluent households necessarily paid as a share of ALL their economic income. Deductions, exclusions, avoidance, shifting between wage and capital income, and the tax base mattered enormously. A Congressional Research Service analysis distinguishes top rates from average effective rates and describes their very different historical patterns (Source 03). Nostalgia is not a revenue model. Even when nostalgia comes wearing an Eisenhower button.

TODAY & THE PROBLEM

For tax year 2026, the federal statutory top individual ordinary-income rate is 37%. For married joint filers, that bracket begins above $768,700 of taxable income; for single filers it begins above $640,600 (Source 04). Those thresholds describe present tax law, not AP's proposed $5 million bracket.

Income does not all receive identical treatment. The federal tax code provides preferential rates for qualifying long-term capital gains, and a separate 3.8% net investment income tax applies to certain investment income above statutory thresholds (Sources 05, 06). A high top wage rate without coherent treatment of economically comparable forms of income can encourage taxpayers to relabel compensation or change when gains are realized.

That last point is not speculation dressed as economic sophistication. The Joint Committee on Taxation explicitly includes taxpayer behavioral responses in revenue estimating, including shifts in reported taxable income (Source 07). Yale's Budget Lab warned in October 2026 that increasing taxes on the highest earners raises finite revenue, and that avoidance and overlapping tax bases can materially reduce collections (Source 08). AP should confront this evidence rather than promising that a 92% headline automatically funds every other proposal in the platform.

THE LEGAL PATH

Congress has broad constitutional authority to enact graduated federal income taxes under the Sixteenth Amendment (Source 01). Ordinary legislative changes to tax brackets can generally be enacted by statute; the proposal does not automatically require a new constitutional amendment. Revenue legislation must comply with congressional procedures, including the constitutional requirement that bills for raising revenue originate in the House (Source 09). Treasury and the IRS would administer implementing rules subject to statutory boundaries and judicial review.

A legally durable bill needs a precise definition of income, filing units, transition rules, treatment of carried interests and pass-through entities, guardrails against disguised compensation, enforcement resources, taxpayer appeal rights, and anti-double-taxation safeguards. It must also explain how the separate $80,000 zero-rate proposal interacts with credits and deductions. It should not try to convert an income-tax bill into an unexamined tax on unrealized wealth.

THE PLAN

PHASE ONE · DEFINE THE TAX BASE

Begin with a public draft defining taxable income above $5 million, including an explicit account of what remains taxed at preferential capital-gains rates and which anti-recharacterization protections apply. Distinguish ordinary income, capital income, business income, and income earned through trusts. Keep transparent tables showing how the bill treats a single filer, a married couple, an owner-operated business, and a shareholder compensated in equity.

PHASE TWO · CLOSE THE DETOURS

Give tax administration enforceable reporting requirements, independent audit review, and effective penalties for misreporting while preserving due process and confidentiality. Study the actual costs of compliance and whether proposed anti-avoidance rules can be administered without trapping ordinary small businesses or encouraging the movement of activity outside the tax base.

PHASE THREE · REVIEW REVENUE & BEHAVIOR

Phase implementation and publish annual comparisons between projected and observed collections, realizations, compensation shifting, business formation, investment, migration, audit costs and litigation. Do not treat every change in taxpayer behavior as proof of economic collapse, or every dollar reported as proof that the policy accomplished its goals. Adjust the law based on measured outcomes.

THE ONE-YEAR & TEN-YEAR LEDGER

A tax rate is not a revenue forecast. Consider a purely illustrative taxpayer with $6 million in taxable ordinary income under a counterfactual flat 37% rate on only the $1 million slice above $5 million: that slice would generate $370,000. At 92% it generates $920,000. The arithmetic difference is $550,000, before changes in behavior, special tax treatments, deductions, credits, timing, and interactions with other taxes. This comparison is NOT the taxpayer's total federal liability and is NOT a forecast of additional federal revenue.

If 1,000 hypothetical taxpayers each had precisely that one-million-dollar taxable slice, the mechanical increment would be $550 million for a single unchanged year. Repeating that frozen scenario for ten years yields $5.5 billion. Both figures are stylized arithmetic only: they assume no tax-base erosion, no income growth, no inflation indexing, no interaction with other tax changes, no enforcement expense, and no macroeconomic feedback. They cannot be substituted for the enacted-law baseline or an official revenue estimate.

The required ten-year model must instead estimate every fiscal year separately: distribution of taxable income above $5 million; thresholds and indexing; capital-gains realizations; business-income shifting; compliance and enforcement costs; timing and transition effects; behavioral response bands; any interactions with the zero-rate $80,000 band; and net receipts relative to CURRENT law. Joint Committee on Taxation and independent microsimulation methods provide models for accounting for taxpayer response (Sources 07, 08). Program funding must not be booked until a credible estimate exists.

WHAT COULD GO WRONG?

A 92% top rate creates an enormous incentive to keep the last dollar out of its taxable category. Critics argue that very high marginal rates may discourage some productive activity, prompt tax planning, delay asset sales, change executive compensation, or encourage relocation. The size of those responses is uncertain and depends strongly on policy design (Sources 07, 08). An anti-avoidance regime can itself be costly, complex, and vulnerable to uneven enforcement.

Supporters contend that steeply progressive taxes can limit extreme after-tax income concentration and raise money for public purposes, particularly when exclusions and reclassification opportunities are controlled. The historical existence of high rates establishes legal and political precedent, not proof that restoring them would reproduce a particular growth rate or income distribution (Sources 02, 03). The debate is not resolved by choosing the most emotionally satisfying decade of the twentieth century.

There is also a distinction between an annual income tax and a program intended to prevent permanent billionaire dynasties. The former does not by itself tax wealth accumulated in previous years or unrealized gains. AP must decide openly which additional inheritance, realization, corporate, or ownership reforms it proposes rather than assigning all ambitions to one bracket.

MEASURING SUCCESS

Publish a ten-year annual ledger with receipts net of administrative costs, taxpayer counts and income distributions, effective as well as statutory tax rates, investment and compensation responses, realized gains, avoidance measures, audit outcomes, appeal reversals, and distributional effects. Compare results with the enacted baseline and independent forecasts. Success cannot be defined as the passage of an impressive number into the Internal Revenue Code.

The question is not whether somebody earning more than five million dollars should be permitted to become wealthy. The question American Proletariat is putting on the table is how steeply the nation should tax income above that line, what such a rule would actually collect, and which public obligations those collections could responsibly finance. Let the country argue with the evidence in front of it.

SOURCES & FURTHER READING

01 · National Archives — Sixteenth Amendment to the U.S. Constitution: Federal Income Tax; ratified February 3, 1913.

https://www.archives.gov/milestone-documents/16th-amendment

02 · Tax Policy Center — Historical Highest Marginal Income Tax Rates; historical rate table.

https://taxpolicycenter.org/sites/default/files/statistics/pdf/toprate_historical.pdf

03 · Congressional Research Service — Taxes and the Economy: An Economic Analysis of the Top Statutory Tax Rates Since 1945; December 12, 2012.

https://www.everycrsreport.com/reports/R42729.html

04 · Internal Revenue Service — Internal Revenue Bulletin 2025-45; 2026 federal income-tax tables.

https://www.irs.gov/irb/2025-45_IRB

05 · Internal Revenue Service — Revenue Procedure 2025-32; 2026 capital-gains rate thresholds.

https://www.irs.gov/pub/irs-drop/rp-25-32.pdf

06 · Internal Revenue Service — Topic No. 559: Net Investment Income Tax; 3.8% tax and thresholds.

https://www.irs.gov/taxtopics/tc559

07 · Joint Committee on Taxation — Revenue Estimating; methodology and behavioral responses.

https://www.jct.gov/operations/revenue-estimating/

08 · Yale Budget Lab — John Ricco, Revenue Potential from Taxes at the Top; October 8, 2026.

https://budgetlab.yale.edu/research/revenue-potential-taxes-top

09 · Congressional Research Service — The Federal Taxing Power: A Primer; December 9, 2024.

https://www.congress.gov/crs_external_products/R/PDF/R46551/R46551.3.pdf

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