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 credit. Tax credits such as those for race horses benefit the few in the expense belonging to the many.
Eliminate deductions of charitable contributions. Need to one tax payer subsidize another’s favorite charity?
Reduce the youngster deduction to a max of three small. The country is full, encouraging large families is get.
Keep the deduction of home mortgage interest. Buying strengthens and adds resilience to the economy. If the mortgage deduction is eliminated, as the President’s council suggests, a rural area will see another round of foreclosures and interrupt the recovery of durable 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 insurance policy. In business one deducts the associated with producing wares. The cost of training is partly the repair off ones health.
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 focused. 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 All investment in stocks and bonds always be deductable merely taxed when money is withdrawn from the investment markets. The stock and bond markets have no equivalent towards the real estate’s 1031 exchange. The 1031 marketplace exemption adds stability into the real estate market allowing accumulated equity to be taken for further investment.
(Notes)
GDP and Taxes. Taxes can only be levied as the percentage of GDP. Quicker GDP grows the greater the government’s option to tax. Due to the stagnate economy and the exporting of jobs along with the massive increase in difficulty there does not way the states will survive economically with massive trend of tax revenues. The only possible way to increase taxes through using encourage huge increase in GDP.
Encouraging Domestic Investment. Your 1950-60s taxes 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 twin impact of skyrocketing GDP while providing jobs for the growing middle class. As jobs were come up with the tax revenue from the guts class far offset the deductions by high income earners.
Today almost all of the freed income around 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 inside of the demand for brand name items. Unfortunately those high luxury goods were excessively manufactured off shore. Today capital is fleeing to China and Online GST Return Filing India blighting the manufacturing sector from the US and reducing the tax base at a time when debt and an aging population requires greater tax revenues.
The changes above significantly simplify personal income place a burden on. Except for comprising investment profits which are taxed in a very capital gains rate which reduces annually based with a length of energy capital is invested the amount of forms can be reduced to a couple of pages.