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 credits. Tax credits because those for race horses benefit the few in the expense on the many.
Eliminate deductions of charitable contributions. Why should one tax payer subsidize another’s favorite charity?
Reduce a child deduction to a max of three of their own kids. The country is full, encouraging large families is pass.
Keep the deduction of home mortgage interest. Buying strengthens and adds resilience to the economy. If your mortgage deduction is eliminated, as the President’s council suggests, the will see another round of foreclosures and interrupt the recovery of layout industry.
Allow deductions for expenses 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 cost of producing materials. The cost at work is partially the repair off ones nicely.
Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior to the 1980s revenue tax code was investment oriented. Today it is consumption focused. A consumption oriented economy degrades domestic economic health while subsidizing US trading young 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 All investment in stocks and bonds always be deductable in support taxed when money is withdrawn among the investment market. The stock and bond markets have no equivalent to the real estate’s 1031 give eachother. The 1031 industry exemption adds stability on the real estate market allowing accumulated equity to use for further investment.
GDP and Taxes. Taxes can only be levied as a percentage of GDP. The faster GDP grows the more government’s option to tax. Given the stagnate economy and the exporting of jobs along with the massive increase in difficulty there isn’t really way the us will survive economically with massive take up tax earnings. The only possible way to increase taxes would be to encourage a massive increase in GDP.
Encouraging Domestic Investment. The actual 1950-60s tax rates approached 90% to find 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 growing GDP while providing jobs for the growing middle-class. As jobs were created the tax revenue from the middle class far offset the deductions by high income earners.
Today plenty of the freed income off the upper income earner has left the country for investments in China and the EU at the expense among the US current economic crisis. Consumption tax polices beginning globe 1980s produced a massive increase regarding demand for brand name items. Unfortunately those high luxury goods were too often manufactured off shore. Today capital is fleeing to China and India blighting the manufacturing sector in 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 efile Income Tax India tax bill. Except for accounting for investment profits which are taxed at capital gains rate which reduces annually based with a length of capital is invested quantity of forms can be reduced together with a couple of pages.