In August 1935 Congress passed the Revenue Act of 1935, also known as the Wealth Tax Act. Much of the act was based on President Franklin D. Roosevelt’s recommendation for tax revision. He argued that previous tax laws had unfairly benefited a small percentage of the population and did nothing to prevent the concentration of wealth and economic power in the hands of a few. The act increased the tax rate on the income of individuals who earned over $50,000 per year. Individuals who earned more than $5 million per year were taxed at a rate of 75 percent. The act increased estate and gift taxes. The act lowered the tax rate for small corporations but raised the tax rate for corporations that earned more than $50,000 per year.
