The Economic Recovery Tax Act of 1981 was a significant piece of legislation aimed at stimulating the U.S. economy. It introduced substantial tax cuts for individuals and businesses, with the goal of encouraging investment and consumer spending. The act reduced the top income tax rate and provided incentives for capital investment, which were intended to spur economic growth during a period of recession. Additionally, the act included provisions for accelerated depreciation, allowing businesses to recover the costs of investments more quickly. This legislation was part of the broader economic policies of President Ronald Reagan, often referred to as "Reaganomics," which emphasized tax reduction and deregulation to promote economic expansion.