Primary Principle – Taxes should be used primarily to fund government operations and not for economic incentives. Too often breaks have unintended consequences and fail to stimulate the economy.
Personal Income Tax
Eliminate AMT and all tax loans. Tax credits pertaining to instance those for race horses benefit the few at the expense on the many.
Eliminate deductions of charitable contributions. Is included in a one tax payer subsidize another’s favorite charity?
Reduce a child deduction to a max of three small. The country is full, encouraging large families is overlook.
Keep the deduction of home mortgage interest. Owning a home 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 layout industry.
Allow deductions for educational 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 materials. The cost of training is in part the repair of ones fitness.
Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior on the 1980s the income tax code was investment oriented. Today it is consumption concentrated. A consumption oriented economy degrades domestic economic health while subsidizing US trading friends. 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 All investment in stocks and bonds ought to deductable only taxed when money is withdrawn out from the investment market. The stock and bond markets have no equivalent on the real estate’s 1031 trading. The 1031 industry exemption adds stability to the real estate market allowing accumulated equity to supply for further investment.
(Notes)
GDP and File GSTR 3b Online Taxes. Taxes can only be levied being a percentage of GDP. The faster GDP grows the more government’s capability to tax. Because of stagnate economy and the exporting of jobs along with the massive increase owing money there isn’t really way the usa will survive economically without a massive take up tax proceeds. The only way possible to increase taxes is encourage a tremendous increase in GDP.
Encouraging Domestic Investment. During the 1950-60s income tax rates approached 90% to find income earners. The tax code literally forced huge salary 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 middle class far offset the deductions by high income earners.
Today much of the freed income off the upper income earner leaves the country for investments in China and the EU at the expense of the US economy. Consumption tax polices beginning inside the 1980s produced a massive increase in the demand for brand name items. Unfortunately those high luxury goods were frequently 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 period of time when debt and an ageing population requires greater tax revenues.
The changes above significantly simplify personal income duty. Except for making up investment profits which are taxed on the capital gains rate which reduces annually based on the length of capital is invested the amount of forms can be reduced any couple of pages.