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 credit. Tax credits because those for race horses benefit the few at the expense for this many.
Eliminate deductions of charitable contributions. Is included in a one tax payer subsidize another’s favorite charity?
Reduce the child deduction in order to some max of three children. The country is full, encouraging large families is overlook.
Keep the deduction of home mortgage interest. Proudly owning 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 Online GST Application Pune Maharashtra insurance coverage. In business one deducts the associated with producing everything. The cost of labor is in part the repair of ones health.
Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior for 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 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 All investment in stocks and bonds in order to deductable in support taxed when money is withdrawn using the investment market. The stock and bond markets have no equivalent for the real estate’s 1031 exchange. The 1031 marketplace exemption adds stability to the real estate market allowing accumulated equity to be used for further investment.
(Notes)
GDP and Taxes. Taxes can only be levied as a percentage of GDP. Quicker GDP grows the more government’s ability to tax. Within the stagnate economy and the exporting of jobs coupled with the massive increase in the red there is very little way the states will survive economically your massive development of tax proceeds. The only possible way to increase taxes is encourage a tremendous increase in GDP.
Encouraging Domestic Investment. Through the 1950-60s tax rates approached 90% for top level 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 accelerating GDP while providing jobs for the growing middle-class. As jobs were created the tax revenue from the guts class far offset the deductions by high income earners.
Today plenty of the freed income off the upper income earner leaves the country for investments in China and the EU in the expense of this US method. Consumption tax polices beginning regarding 1980s produced a massive increase regarding 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 of 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 in taxes. Except for making up investment profits which are taxed from a capital gains rate which reduces annually based around the length associated with your capital is invested quantity of forms can be reduced to a couple of pages.