Tax Policy

Clinton's Remarkable Record On Taxes (SUMMARY) (TEXT)

Federal taxes have hit another record at 21.7 percent of gross domestic product (GDP) in the first quarter of 1998, according to Commerce Department data. For two years, revenues have never been higher at any time in American history.

To put Bill Clinton's remarkable record into context: federal taxes as a share of GDP averaged 18.5 percent during the entire postwar period up until 1992. Federal taxes claimed 19 percent of GDP when Clinton took office in the first quarter of 1993, already above their postwar average. Yet despite this fact, his first major action in office was to enact one of the largest tax increases in American history.

  • Revenues during World War II peaked at 19.9 percent of GDP in 1943 (see figure).

  • A peak of 20.1 percent of GDP was reached at the height of the Korean War in the first quarter of 1951.

  • The average for the Clinton Administration thus far -- from the first quarter of 1993 through the first quarter of 1998 -- is 20.4 percent of GDP.

The highest percentage of GDP that federal taxes ever took prior to the Clinton Administration was 20.7 percent -- achieved briefly in the second quarter of 1969. Clinton exceeded this previous high in the second quarter of 1996 when revenues hit 20.8 percent of GDP. We have been above that level ever since.

Americans are paying $80 billion more in taxes than they would pay if Clinton merely equaled the highest level ever previously recorded.

Source: Bruce Bartlett, senior fellow, National Center for Policy Analysis, June 29, 1998.

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