Income tax 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 attributes. Tax credits with regard to example those for race horses benefit the few in the expense for this many.
Eliminate deductions of charitable contributions. So here is one tax payer subsidize another’s favorite charity?
Reduce the youngster deduction the max of three younger children. The country is full, encouraging large families is successfully pass.
Keep the deduction of home mortgage interest. Owning a home 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 the construction industry.
Allow deductions for educational costs and interest on student loan. It is advantageous 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 of training is mainly the repair off ones health.
Increase the tax rate to 1950-60s confiscatory levels, but allow liberal deductions for “investments in America”. Prior for the 1980s the income tax code was investment oriented. Today it is consumption driven. A consumption oriented economy degrades domestic economic health while subsidizing US trading friends. 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 All investment in stocks and bonds ought to deductable just taxed when money is withdrawn over investment markets. The stock and bond markets have no equivalent into the real estate’s 1031 give eachother. The 1031 real estate exemption adds stability to the real estate market allowing accumulated equity to be used for further investment.
(Notes)
GDP and Taxes. Taxes can be levied as a percentage of GDP. Quicker GDP grows the more government’s capacity to tax. Within the stagnate economy and the exporting of jobs along with the massive increase in debt there isn’t really way us states will survive economically with massive increase in tax profits. The only possible way to increase taxes through using encourage a tremendous increase in GDP.
Encouraging Domestic Investment. Within 1950-60s income 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 accelerating GDP while providing jobs for the growing middle-class. As jobs were created the tax revenue from the guts class far offset the deductions by high income earners.
Today almost all of the freed income off the upper income earner has left the country for investments in China and the EU in the expense of this US financial system. Consumption tax polices beginning globe 1980s produced a massive increase planet 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 in the US and reducing the tax base at a time when debt and Online GST Registration Pune a maturing population requires greater tax revenues.
The changes above significantly simplify personal income tax bill. Except for making up investment profits which are taxed at capital gains rate which reduces annually based using a length of time capital is invested the amount of forms can be reduced together with a couple of pages.
