Fees to Encourage Investment

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 snack bars. Tax credits while those for race horses benefit the few in the expense among the many.

Eliminate deductions of charitable contributions. Must you want one tax payer subsidize another’s favorite charity?

Reduce the youngster deduction in order to some max of three small. The country is full, encouraging large families is overlook.

Keep the deduction of home mortgage interest. Buying strengthens and adds resilience to the economy. In the event 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 educational costs and interest on student loan. It is advantageous for federal government to encourage education.

Allow 100% deduction of medical costs and insurance plan. In business one deducts the price producing solutions. The cost of labor 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 towards 1980s earnings tax code was investment oriented. Today it is consumption oriented. 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 All investment in stocks and bonds in order to deductable in support taxed when money is withdrawn out from the investment market. The stock and bond markets have no equivalent to the real estate’s 1031 flow. The 1031 industry exemption adds stability to your real estate market allowing accumulated equity to supply for further investment.

(Notes)

GDP and Taxes. Taxes can be levied being a percentage of GDP. Quicker GDP grows the more government’s chance to tax. Because of stagnate economy and the exporting of jobs along with the massive increase owing money there is limited way the states will survive economically with massive development of tax revenues. The only way possible to increase taxes is encourage a massive increase in GDP.

Encouraging Domestic Investment. Within 1950-60s taxes rates approached 90% for the top 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 developed the tax revenue from the middle class far offset the deductions by high income earners.

Today via a tunnel the freed income around the upper income earner leaves the country for investments in China and the EU at the expense with the 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 Online GST Return Filing India blighting the manufacturing sector belonging to the US and reducing the tax base at a period when debt and an aging population requires greater tax revenues.

The changes above significantly simplify personal income in taxes. Except for comprising investment profits which are taxed at a capital gains rate which reduces annually based around the length of your capital is invested quantity of forms can be reduced along with couple of pages.