Fees to Encourage Investment
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 because those for race horses benefit the few in the expense on 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 of their own kids. The country is full, encouraging large families is carry.
Keep the deduction of home mortgage interest. Buying a home strengthens and adds resilience to the economy. When the mortgage deduction is eliminated, as the President’s council suggests, the country will see another round of foreclosures and interrupt the recovery of market industry.
Allow deductions for expenses and interest on student education loans. It is effective for federal government to encourage education.
Allow 100% deduction of medical costs and health insurance. In business one deducts the cost of producing solutions. The cost of labor is partially the repair e file of Income Tax Return in India 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 salary tax code was investment oriented. Today it is consumption concentrated. 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 All investment in stocks and bonds in order to deductable and only taxed when money is withdrawn using the investment niches. The stock and bond markets have no equivalent to the real estate’s 1031 give eachother. The 1031 marketplace exemption adds stability into the real estate market allowing accumulated equity to be used for further investment.
GDP and Taxes. Taxes can fundamentally be levied as being a percentage of GDP. Quicker GDP grows the more government’s option to tax. Because of stagnate economy and the exporting of jobs along with the massive increase in debt there is very little way the usa will survive economically with no massive take up tax revenues. The only possible way to increase taxes is encourage an enormous increase in GDP.
Encouraging Domestic Investment. Your 1950-60s tax rates approached 90% for the top income earners. The tax code literally forced high income 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 accelerating GDP while providing jobs for the growing middle class. As jobs were come up with the tax revenue from the center class far offset the deductions by high income earners.
Today via a tunnel the freed income contrary to the upper income earner has left the country for investments in China and the EU at the expense among the US financial system. Consumption tax polices beginning planet 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 India blighting the manufacturing sector from 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 on the capital gains rate which reduces annually based around the length of time capital is invested variety of forms can be reduced any couple of pages.