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 because those for race horses benefit the few at the expense for this many.
Eliminate deductions of charitable contributions. So here is one tax payer subsidize another’s favorite charity?
Reduce a child deduction the max of three the 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. 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 market industry.
Allow deductions for education costs and interest on so to speak .. It is effective for brand new to encourage education.
Allow 100% deduction of medical costs and health insurance. In business one deducts the price producing materials. The cost at work is partly the repair of ones very well being.
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 driven. 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 All investment in stocks and bonds always be deductable just taxed when money is withdrawn over investment niches. The stock and bond markets have no equivalent for the real estate’s 1031 give eachother. The 1031 real estate exemption adds stability into the real estate market allowing accumulated equity to supply for further investment.
GDP and Taxes. Taxes can only be levied being a percentage of GDP. The faster GDP grows the more government’s option to tax. Within the stagnate economy and the exporting of jobs along with the massive increase in debt there isn’t really way the usa will survive economically any massive increase in tax gains. The only way you can to increase taxes is encourage a massive increase in GDP.
Encouraging Domestic Investment. The actual 1950-60s income tax rates approached 90% to your advantage income earners. The tax code literally forced great 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 middle class far offset the deductions by high income earners.
Today via a tunnel the freed Efile income tax Return india contrary to the upper income earner has left the country for investments in China and the EU at the expense among the US economic state. Consumption tax polices beginning regarding 1980s produced a massive increase planet 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 when debt and an ageing population requires greater tax revenues.
The changes above significantly simplify personal income duty. Except for accounting for investment profits which are taxed in a very capital gains rate which reduces annually based using a length of energy capital is invested the number of forms can be reduced using a couple of pages.