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 while those for file gstr 1 online race horses benefit the few at the expense of the many.
Eliminate deductions of charitable contributions. So here is one tax payer subsidize another’s favorite charity?
Reduce your son or daughter deduction in order to some max of three small. The country is full, encouraging large families is get.
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, the world will see another round of foreclosures and interrupt the recovery of layout industry.
Allow deductions for education costs and interest on student loan. It is effective for brand new to encourage education.
Allow 100% deduction of medical costs and health insurance. In business one deducts the associated with producing wares. The cost of employment is partly the upkeep of ones fitness.
Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior to 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 All investment in stocks and bonds should be deductable in support taxed when money is withdrawn among the investment niches. The stock and bond markets have no equivalent on the real estate’s 1031 exchange. The 1031 marketplace exemption adds stability for the real estate market allowing accumulated equity to be used for further investment.
(Notes)
GDP and Taxes. Taxes can only be levied being a percentage of GDP. The faster GDP grows the greater the government’s capacity to tax. Because of stagnate economy and the exporting of jobs coupled with the massive increase in the red there is very little way the usa will survive economically your massive development of tax profits. The only way you can to increase taxes through using encourage a massive increase in GDP.
Encouraging Domestic Investment. Your 1950-60s taxes 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 dual 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 almost all of the freed income around the upper income earner has left the country for investments in China and the EU at the expense with the US economy. Consumption tax polices beginning planet 1980s produced a massive increase inside of 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 among the US and reducing the tax base at a period of time when debt and an aging population requires greater tax revenues.
The changes above significantly simplify personal income in taxes. Except for accounting for investment profits which are taxed from a capital gains rate which reduces annually based with a length of energy capital is invested the number of forms can be reduced to a couple of pages.