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 GST Registration online Mumbai Maharashtra all tax credit. Tax credits because those for race horses benefit the few at the expense among the many.
Eliminate deductions of charitable contributions. Must you want one tax payer subsidize another’s favorite charity?
Reduce your son or daughter deduction in order to some max of three small. The country is full, encouraging large families is pass.
Keep the deduction of home mortgage interest. Proudly owning strengthens and adds resilience to the economy. In case the mortgage deduction is eliminated, as the President’s council suggests, the uk will see another round of foreclosures and interrupt the recovery of the construction industry.
Allow deductions for educational costs and interest on student loans. It is effective for the government to encourage education.
Allow 100% deduction of medical costs and insurance policy. In business one deducts the cost of producing materials. The cost on the job is partly the upkeep of ones nicely.
Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior to the 1980s salary 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 All investment in stocks and bonds in order to be deductable in support taxed when money is withdrawn out from the investment niches. The stock and bond markets have no equivalent into the real estate’s 1031 exchange. The 1031 real estate exemption adds stability to the real estate market allowing accumulated equity to be taken for further investment.
GDP and Taxes. Taxes can be levied as being a percentage of GDP. Quicker GDP grows the more government’s ability to tax. Given the stagnate economy and the exporting of jobs coupled with the massive increase in difficulty there is very little way the us will survive economically your massive trend of tax revenues. The only possible way to increase taxes would be to encourage huge increase in GDP.
Encouraging Domestic Investment. Within 1950-60s taxes rates approached 90% to your advantage 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 accelerating GDP while providing jobs for the growing middle class. As jobs were created the tax revenue from the very center class far offset the deductions by high income earners.
Today much of the freed income around the upper income earner has left the country for investments in China and the EU at the expense of this US current economic crisis. Consumption tax polices beginning planet 1980s produced a massive increase a demand for brand name items. Unfortunately those high luxury goods were constantly manufactured off shore. Today capital is fleeing to China and India blighting the manufacturing sector among 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 place a burden on. Except for comprising investment profits which are taxed at a capital gains rate which reduces annually based on the length of your capital is invested variety of forms can be reduced any couple of pages.