“The reason for the world-wide trend toward lower top rates is clear. Excessive rates of income tax destroy enterprise, encourage avoidance, and drive talent to more hospitable shores overseas.”1
—NIGEL LAWSON, CHANCELLOR OF THE EXCHEQUER, HMG
IN THE UNITED STATES THE DEBATE OVER REAGAN’S GREAT Experiment rages on. But abroad the verdict is clear. In a shining example of that sincerest form of flattery, nearly all the industrialized nations as well as most of the newly developing nations have either reduced their tax rates during the 1980s or scheduled rate reductions for the early 1990s.
The worldwide reduction in taxes is part of a larger worldwide movement toward free markets, again led by the United States. But though ...