Capping the earnings of the likes of Mark Zuckerberg or Bill Gates would do little to actually boost the poor and middle class, Summers, a former economic advisor to President Obama and the treasury secretary from 1999 to 2001, argued in a Washington Post op-ed Sunday. But closing tax loopholes that largely benefit the wealthy -- like the capital gains exemption, certain estate tax provisions and corporate tax breaks -- could help middle-class and poor Americans, he wrote.
“Today’s tax code allows a far larger share of the income of the rich to escape taxation than the poor or middle class,” Summers wrote. “Closing loopholes that only the wealthy can enjoy would enable targeted tax measures such as the earned-income tax credit to raise the incomes of the poor and middle class more than dollar for dollar by incentivizing working and saving,” he continued.
Still, some studies have backed up Summers' idea that reforming the tax code could make a dent in income inequality. According to a 2013 study from the Institute on Taxation and Economic Policy, when you consider things like sales and state and local taxes, the poor fork over a larger share of their income to Uncle Sam than their richer counterparts.
http://www.huffingtonpost.com/2014/02/17/taxes-rich-larry-summers_n_4804285.html
“Today’s tax code allows a far larger share of the income of the rich to escape taxation than the poor or middle class,” Summers wrote. “Closing loopholes that only the wealthy can enjoy would enable targeted tax measures such as the earned-income tax credit to raise the incomes of the poor and middle class more than dollar for dollar by incentivizing working and saving,” he continued.
Still, some studies have backed up Summers' idea that reforming the tax code could make a dent in income inequality. According to a 2013 study from the Institute on Taxation and Economic Policy, when you consider things like sales and state and local taxes, the poor fork over a larger share of their income to Uncle Sam than their richer counterparts.
http://www.huffingtonpost.com/2014/02/17/taxes-rich-larry-summers_n_4804285.html