Primary Principle – Taxes should be used primarily to fund government operations and not for economic incentives. Too often tax credits have unintended consequences and fail to stimulate the economy.
Personal Income Tax
Eliminate AMT and all tax loans. Tax credits because those for race horses benefit the few at the expense on the many.
Eliminate deductions of charitable contributions. Need to one tax payer subsidize another’s favorite charity?
Reduce your son or daughter deduction in order to some max of three the children. The country is full, encouraging large families is successfully pass.
Keep the deduction of home mortgage interest. Proudly owning strengthens and adds resilience to the economy. When 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 layout industry.
Allow deductions for educational costs and interest on so to speak .. It is effective for federal government to encourage education.
Allow 100% deduction of medical costs and health insurance. In business one deducts the price producing wares. The cost of employment is in part the repair of ones nicely.
Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior into 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 spouse. 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 All investment in stocks and bonds ought to deductable and only taxed when money is withdrawn among the investment areas. The stock and bond markets have no equivalent into the real estate’s 1031 give eachother. The 1031 industry exemption adds stability into the real estate market allowing accumulated equity to use for further investment.
GDP and Taxes. Taxes can simply be levied being a percentage of GDP. The faster GDP grows the greater the government’s capability to tax. More efficient stagnate economy and the exporting of jobs along with the massive increase in debt there does not way us states will survive economically with no massive development of tax revenues. The only possible way to increase taxes would be to encourage huge increase in GDP.
Encouraging Domestic Investment. Within 1950-60s taxes rates approached 90% to your advantage income earners. The tax code literally forced huge salary 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 growing GDP while providing jobs for the growing middle class. As jobs were came up with tax revenue from the guts class far offset the deductions by high income earners.
Today much of the freed income off the upper income earner leaves the country for investments in China and the EU in the expense among the US economy. Consumption tax polices beginning inside the 1980s produced a massive increase regarding demand for brand name items. Unfortunately those high luxury goods were excessively manufactured off shore. Today capital is fleeing to China and Online GST Return India blighting the manufacturing sector of the US and reducing the tax base at a period of time when debt and an aging population requires greater tax revenues.
The changes above significantly simplify personal income place a burden on. Except for making up investment profits which are taxed on the capital gains rate which reduces annually based using a length of time capital is invested quantity of forms can be reduced to a couple of pages.