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 of the many.
Eliminate deductions of charitable contributions. Is included in a one tax payer subsidize another’s favorite charity?
Reduce your son or daughter deduction in order to some max of three children. The country is full, encouraging large families is successfully pass.
Keep the deduction of home mortgage interest. Buying strengthens and adds resilience to the economy. If your mortgage deduction is eliminated, as the President’s council suggests, the will see another round of foreclosures and interrupt the recovery of durable industry.
Allow deductions for education costs and interest on student loan. It is advantageous for the government to encourage education.
Allow 100% deduction of medical costs and insurance coverage. In business one deducts the cost of producing goods. The cost on the job is partially the maintenance of ones nicely.
Increase the efile Tax Return India rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior to the 1980s salary tax code was investment oriented. Today it is consumption focused. A consumption oriented economy degrades domestic economic health while subsidizing US trading collaborators. 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 All investment in stocks and bonds in order to deductable only taxed when money is withdrawn among the investment market. The stock and bond markets have no equivalent on the real estate’s 1031 exchange. The 1031 real estate exemption adds stability into the real estate market allowing accumulated equity to be utilized for further investment.
(Notes)
GDP and Taxes. Taxes can simply be levied being a percentage of GDP. The faster GDP grows the greater the government’s chance to tax. More efficient stagnate economy and the exporting of jobs along with the massive increase in the red there is very little way us states will survive economically any massive craze of tax revenues. The only way possible to increase taxes is encourage a massive increase in GDP.
Encouraging Domestic Investment. Through the 1950-60s income tax rates approached 90% to your advantage 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 skyrocketing GDP while providing jobs for the growing middle class. As jobs were came up with tax revenue from the very center 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 at the expense of the US economy. Consumption tax polices beginning in the 1980s produced a massive increase inside of the demand for brand name items. Unfortunately those high luxury goods were constantly manufactured off shore. Today capital is fleeing to China and India blighting the manufacturing sector among the US and reducing the tax base at a period when debt and an aging population requires greater tax revenues.
The changes above significantly simplify personal income place a burden on. Except for comprising investment profits which are taxed on the capital gains rate which reduces annually based upon the length of capital is invested quantity of forms can be reduced any couple of pages.