Revenue Wealth Tax Act
The Revenue Wealth Tax Act of 1935 increased the surtax on income beyond $75,000. Surtax rates on incomes beyond $5 million increased to 75 percent (up from 59 percent). It also increased existing estate and gift taxes and introduced graduated corporate income taxes.
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Roosevelt Proposed Bill to Congress
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Roosevelt proposed the changes in a June 19, 1935 "special message to Congress." The House bill was introduced July 29. It was approved Aug. 22 in the House and Aug. 24 in the Senate. Roosevelt signed it on Aug. 30, 1935.
Other Things the Law Did
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The law also increased estate taxes for those worth more than $40,000. The corporate tax rate went from a flat 13 percent to 15 percent on businesses with income greater than $50,000 and 12.5 percent on smaller businesses. The new law imposed a 6-percent surtax on profits over 10 percent and a 12-percent surtax on profits exceeding 15 percent.
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Critics Labeled it "Soak the Rich"
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In his message to Congress, Roosevelt wrote, "If a government is to be prudent, its taxes must produce ample revenue without discouraging enterprise; and if it is to be just it must distribute the burden of taxes equitably." This led opponents to label it as a "soak the rich" or "share the wealth" program.
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