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 in the expense for this many.
Eliminate deductions of charitable contributions. Why should one tax payer subsidize another’s favorite charity?
Reduce the youngster deduction the max of three the children. The country is full, encouraging large families is carry.
Keep the deduction of home mortgage interest. Home ownership strengthens and adds resilience to the economy. In case the mortgage deduction is eliminated, as the President’s council suggests, the will see another round of foreclosures and interrupt the recovery of layout industry.
Allow deductions for expenses and interest on so to speak .. It pays to for the government to encourage education.
Allow 100% deduction of medical costs and health insurance. In business one deducts the cost of producing materials. The cost of labor is in part the upkeep of ones health.
Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior for the 1980s earnings tax code was investment oriented. Today it is consumption concentrated. 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 All investment in stocks and bonds should be deductable in support taxed when money is withdrawn over investment areas. The stock and bond markets have no equivalent for the real estate’s 1031 exchange. The 1031 marketplace exemption adds stability on the real estate market allowing accumulated equity to use for further investment.
GDP and Taxes. Taxes can be levied as the percentage of GDP. The faster GDP grows the more government’s capacity to tax. More efficient stagnate economy and the exporting of jobs coupled with the massive increase in difficulty there isn’t really way the states will survive economically with massive craze of tax revenues. The only way you can to increase taxes through using encourage a tremendous increase in GDP.
Encouraging Domestic Investment. Within 1950-60s tax rates approached 90% to find 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 growing GDP while providing jobs for the growing middle class. As jobs were come up with tax revenue from the very center class far offset the deductions by high income earners.
Today lots of the freed income around the upper income earner leaves the country for investments in China and the EU at the expense for the US economy. Consumption tax polices beginning planet 1980s produced a massive increase inside of the demand GST Application Mumbai Maharashtra 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 in 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 place a burden on. Except for comprising investment profits which are taxed from a capital gains rate which reduces annually based using a length associated with your capital is invested quantity of forms can be reduced along with couple of pages.