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 credits. Tax credits because those for race horses benefit the few in the expense for this many.
Eliminate deductions of charitable contributions. Need to one tax payer subsidize another’s favorite charity?
Reduce the youngster deduction the max of three small. The country is full, encouraging large families is successfully pass.
Keep the deduction of home mortgage interest. Owning a home strengthens and adds resilience to the economy. If the mortgage deduction is eliminated, online gst registration maharashtra as the President’s council suggests, the world will see another round of foreclosures and interrupt the recovery of the construction industry.
Allow deductions for education costs and interest on student loans. 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 at work is simply the repair of ones nicely.
Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior for the 1980s revenue 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 All investment in stocks and bonds should be deductable just taxed when money is withdrawn from the investment market. The stock and bond markets have no equivalent on the real estate’s 1031 pass on. The 1031 property exemption adds stability into the real estate market allowing accumulated equity to be used for further investment.
GDP and Taxes. Taxes can only be levied being a percentage of GDP. Quicker GDP grows the greater the government’s chance to tax. Within the stagnate economy and the exporting of jobs coupled with the massive increase owing money there is no way the states will survive economically without a massive take up tax revenues. The only way you can to increase taxes is encourage a tremendous increase in GDP.
Encouraging Domestic Investment. Through the 1950-60s tax rates approached 90% to your advantage income earners. The tax code literally forced comfortable living earners to “Invest in America”. Such policies of deductions for pre paid interest, funding limited partnerships and other investments against earned income had the dual impact of skyrocketing 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 almost all of the freed income out of your upper income earner has left the country for investments in China and the EU at the expense for the US financial system. Consumption tax polices beginning inside the 1980s produced a massive increase in the demand for brand name items. Unfortunately those high luxury goods were more often than not 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 ageing population requires greater tax revenues.
The changes above significantly simplify personal income place a burden on. Except for comprising investment profits which are taxed at a capital gains rate which reduces annually based with a length of energy capital is invested the number of forms can be reduced together with a couple of pages.