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 with regard to example those for race horses benefit the few at the expense for this many.

Eliminate deductions of charitable contributions. So here is one tax payer subsidize another’s favorite charity?

Reduce the child deduction to a max of three the children. The country is full, encouraging large families is get.

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 uk will see another round of foreclosures and interrupt the recovery of market industry.

Allow deductions for educational costs and interest on student education loans. It pays to for federal government to encourage education.

Allow 100% deduction of medical costs and insurance coverage. In business one deducts the associated with producing goods. The cost at work is in part the repair off ones fitness.

Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior for the 1980s salary tax code was investment oriented. Today it is consumption driven. 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 All investment in stocks and bonds in order to deductable and only taxed when money is withdrawn from the investment areas. The stock and bond markets have no equivalent on the real estate’s 1031 pass on. The 1031 marketplace exemption adds stability on the real estate market allowing accumulated equity to be taken for further investment.

(Notes)

GDP and Taxes. Taxes can simply be levied for a percentage of GDP. The faster GDP grows the greater the government’s capacity to tax. Within the stagnate economy and the exporting of jobs along with the massive increase owing money there is very little way the usa will survive economically with no massive trend of tax revenues. The only way you can to increase taxes would be to encourage a massive increase in GDP.

Encouraging Domestic Investment. Your 1950-60s tax rates approached 90% for top level 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 skyrocketing GDP while providing jobs for the growing middle-class. As jobs were came up with tax revenue from the guts class far offset the deductions by high income earners.

Today much of the freed income from the upper income earner leaves the country for investments in China and the EU at the expense for the US economic state. Consumption tax polices beginning in 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 File GSTR 3b Online belonging to the US and reducing the tax base at a period of time when debt and an ageing 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 on the length of your capital is invested the amount of forms can be reduced using a couple of pages.

Income tax to Encourage Investment

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