The Use of Irrevocable Medicaid Income Only Trusts

In continuing my discussion on this topic from a few weeks ago, I now turn to a look at government revenue and economic growth. The average income tax rate for an American citizen is approximately 13 percent. In order to cover current government expenses this tax rate would have had to double – without even including the negative effects that higher tax rates would likely have on GDP growth. Is a doubling of income tax rates realistic and/or politically palatable? Absolutely not. Are higher tax rates not only likely but also necessary? Most likely, yes.