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 snack bars. 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 the child deduction the max of three children. The country is full, encouraging large families is pass.
Keep the deduction of home mortgage interest. Owning a home strengthens and adds resilience to the economy. In case the mortgage deduction is eliminated, as the President’s council suggests, the country will see another round of foreclosures and interrupt the recovery of layout industry.
Allow deductions for education costs and interest on so to speak .. It pays to for brand new to encourage education.
Allow 100% deduction of medical costs and insurance coverage. In business one deducts the associated with producing everything. The cost at work is partly the maintenance of ones fitness.
Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior towards 1980s revenue tax code was investment oriented. Today it is consumption concentrated. 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 All investment in stocks and bonds in order to deductable and only taxed when money is withdrawn from the investment niches. The stock and bond markets have no equivalent into the real estate’s 1031 flow. The 1031 marketplace exemption adds stability to your real estate market allowing accumulated equity to be utilized for further investment.
GDP and Taxes. Taxes can only be levied being a percentage of GDP. The faster GDP grows the greater the government’s ability to tax. More efficient stagnate economy and the exporting of jobs along with the massive increase in the red there is very little way united states will survive economically your massive development of tax profits. The only way possible to increase taxes is to encourage a massive increase in GDP.
Encouraging Domestic Investment. During the 1950-60s taxes rates approached 90% for top 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 came up with tax revenue from the guts class far offset the deductions by high income earners.
Today much of the freed income contrary to the upper income earner leaves the country for investments in China and the EU at the expense among the US economy. Consumption tax polices beginning inside the 1980s produced a massive increase a 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 belonging to the US and reducing the tax base at a time when debt and an ageing population requires greater tax revenues.
The changes above significantly simplify personal Income Tax Rates India in taxes. Except for comprising investment profits which are taxed at capital gains rate which reduces annually based on the length of time capital is invested the amount of forms can be reduced to a couple of pages.