Income taxes 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 snack bars. 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 your son or daughter deduction together with a max of three of their own kids. The country is full, encouraging large families is get.
Keep the deduction of home mortgage interest. Home ownership 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 durable industry.
Allow deductions for educational costs and interest on student education loans. It pays to for brand new to encourage education.
Allow 100% deduction of medical costs and health insurance. In business one deducts the associated with producing solutions. The cost of labor is partly the maintenance of ones very well being.
Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior into the 1980s revenue 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 All investment in stocks and bonds ought to deductable merely taxed when money is withdrawn out from the investment markets. The stock and bond markets have no equivalent on the real estate’s 1031 flow. The 1031 real estate exemption adds stability for the real estate market allowing accumulated equity to supply for further investment.
(Notes)
GDP and Taxes. Taxes can simply be levied as the percentage of GDP. The faster GDP grows the greater the government’s option to tax. Given the stagnate economy and the exporting of jobs along with the massive increase owing money there does not way us states will survive economically your massive development of tax profits. The only possible way to increase taxes is encourage huge increase in GDP.
Encouraging Domestic Investment. Within 1950-60s taxes rates approached 90% for Online GST Return Filing top level income earners. The tax code literally forced huge salary 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 tax revenue from the middle class far offset the deductions by high income earners.
Today via a tunnel the freed income contrary to the upper income earner leaves the country for investments in China and the EU in the expense among the US economic state. Consumption tax polices beginning inside the 1980s produced a massive increase inside of the 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 from the US and reducing the tax base at a time full when debt and an ageing population requires greater tax revenues.
The changes above significantly simplify personal income duty. Except for making up investment profits which are taxed at a capital gains rate which reduces annually based upon the length of capital is invested quantity of forms can be reduced using a couple of pages.
