Wasn't Reagan big on that one? Didn't quite work out ...
It didn't?
Critics of the Reagan tax cuts today compare the 11.6% growth in federal revenue in 1980, the last year of the Carter administration, with the decline in revenue in 1983. They then declare that the Reagan tax cuts slashed federal revenue. Conveniently missing in that comparison is that the 1980-82 recession, with 10.8% unemployment, reduced federal revenue twice as much as the Joint Committee on Taxation estimated the Reagan tax cuts would in 1982 and 15% more than its estimate for 1983.
What’s more, the expectations of rising revenue during the early Reagan years were based on the assumption that inflation and bracket creep would not let up. In 1981, all public and private economic forecasts predicted continued high inflation.
The opposite occurred. As inflation plummeted from the CBO’s projected average annual rate of 8.3% for 1982-86 to an average of 3.8%, revenue compared with projections tumbled $22 billion in 1982 and $70.4 billion in 1983 solely because of reduced inflation and bracket creep.
The Joint Committee on Taxation’s static cost estimate of the Reagan tax cuts was $37.6 billion in 1982 and $92.7 billion in 1983. In other words, the collapse of inflation and bracket creep and the double-dip recession caused revenue losses more than twice as big as the projected static cost of the Reagan tax cuts.
The Reagan tax cuts were implemented in three installments, with the top marginal rate falling to 50% from 70%.
When the reductions were fully in effect in 1983, the economy snapped out of the recession, and real growth averaged 4.6% for the remainder of the Reagan presidency—more than his much-maligned “rosy scenario” ever promised.
In 1984, a final good-government tax provision—indexing individual brackets for inflation and thereby eliminating bracket creep—was implemented.
Although indexing reduced revenue, it was overpowered by surging economic growth. Then the 1986 tax reform cut subsidies and special-interest provisions, lowered the top individual tax rate to 28%, dropped the top corporate tax rate to 34% from 46%, and provided additional incentives to work, save and invest.
When Reagan left office, real federal revenue was more than 19% higher than it was the day of his first inauguration.
A major recession had been overcome, inflation had been broken, the tax code had been indexed to eliminate bracket creep, and the largest tax cut of the postwar era had been implemented.
The Reagan tax cuts and the boom they created stand as the most successful policy initiative and recovery of the postwar era—the polar opposite of Obama’s program and economy.
The Reagan tax cuts laid the foundation for a quarter-century of strong, noninflationary growth, which, despite three subsequent recessions, averaged 3.4% until the beginning of the Obama administration
Tax revenue was generated by an expanding economy rather than pilfered through bracket creep.
https://www.wsj.com/articles/reagan-cut-taxes-revenue-boomed-1501800678