Primary Principle – Taxes should be used primarily to fund government operations and not for economic incentives. Too often breaks have unintended consequences and fail to stimulate the economy.
Personal Income Tax
Eliminate AMT and all tax credits. Tax credits such as those for race horses benefit the few in the expense belonging to the many.
Eliminate deductions of charitable contributions. Why should one tax payer subsidize another’s favorite charity?
Reduce the child deduction the max of three small. The country is full, encouraging large families is carry.
Keep the deduction of home mortgage interest. Proudly owning strengthens and adds resilience to the economy. If the mortgage deduction is eliminated, as the President’s council suggests, a rural area will see another round of foreclosures and interrupt the recovery of the construction industry.
Allow deductions for expenses and interest on student loans. It is effective for federal government to encourage education.
Allow 100% deduction of medical costs and insurance policy. In business one deducts the cost of producing materials. The cost of labor is partly the upkeep of ones fitness.
Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments Online GST Registration in Pune Maharashtra America”. Prior on the 1980s salary tax code was investment oriented. Today it is consumption driven. A consumption oriented economy degrades domestic economic health while subsidizing US trading partners. The stagnating economy and the ballooning trade deficit are symptoms of consumption tax policies.
Eliminate 401K and IRA programs. All investment in stocks and bonds ought to deductable and only taxed when money is withdrawn out from the investment market. The stock and bond markets have no equivalent into the real estate’s 1031 pass on. The 1031 marketplace exemption adds stability to the real estate market allowing accumulated equity to be utilized for further investment.
GDP and Taxes. Taxes can only be levied as the percentage of GDP. The faster GDP grows the greater the government’s capacity to tax. Because of stagnate economy and the exporting of jobs coupled with the massive increase in debt there is limited way the us will survive economically without a massive increase in tax revenues. The only possible way to increase taxes is to encourage a tremendous increase in GDP.
Encouraging Domestic Investment. The actual 1950-60s tax rates approached 90% for top level income earners. The tax code literally forced financial security earners to “Invest in America”. Such policies of deductions for pre paid interest, funding limited partnerships and other investments against earned income had the twin impact of accelerating GDP while providing jobs for the growing middle class. As jobs were come up with the tax revenue from the middle class far offset the deductions by high income earners.
Today via a tunnel the freed income out of your upper income earner leaves the country for investments in China and the EU in the expense with the US economy. Consumption tax polices beginning globe 1980s produced a massive increase planet demand for brand name items. Unfortunately those high luxury goods were excessively manufactured off shore. Today capital is fleeing to China and India blighting the manufacturing sector from the US and reducing the tax base at a time full when debt and an ageing population requires greater tax revenues.
The changes above significantly simplify personal income tax bill. Except for accounting for investment profits which are taxed at a capital gains rate which reduces annually based on the length of your capital is invested amount of forms can be reduced to a couple of pages.