The idea that taxes affect economic development has become controversial within government and is the subject of much debate in the press and among support groups. This is partly because there are conflicting theories about the ambitions of economic growth. The Congressional Research Service found support for the philosophy that taxes have no effect on economic growth by looking at U.S. involvement since World War II and the intense variation in the constitutional marginal rate the higher on individual income. They find that the fastest economic growth occurred in the 1950s, when the peak rate was above 90%. However, their study ignores the most fundamental issues with this type of statistical analysis, including: the gap in the tax base to which personal income tax relates; the variation in other taxes, mainly corporate tax; the short-term and long-term effects of tax policy; and reverse causality, as economic growth affects tax rates. These issues are all well recognized in the academic literature and have been addressed in numerous ways, making the CRS study publishable in any peer-reviewed academic journal. Although there are many different parts of the methods and data sources, the results are consistently financial. the substantial negative effects of taxes on economic growth, even after controlling for several other factors such as government spending, business cycle conditions, and financial policy. I believe that the studies, going back to 1983, and these three studies, as well as all the studies over the last 15 years, have a destructive effect of taxes on growth. The following studies differentiate between types of taxes such as: Corporate income taxes are found to be the most damaging, followed by personal income...... middle of paper ...... that government spending is too high and that the U.S. economy could grow much faster if the burden on government were reduced. Having a reasonable, more basic tax system would promote economic growth, improve productivity, and expand international competitiveness. Economic growth is absolutely necessary in our economy and while some fears may exist about moving our tax system to such a system, it would resolve the ambiguity for businesses. Every year there are new developments to our tax structure, rules and regulations. The current system develops doubt which prevents companies from creating investments or expanding their activities in addition to hiring new workers. As more people are employed, more money is accessible to purchase products and services which, in an absorption tax system, generate more revenue for the federal government's responsibilities..