Property 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 credits. Tax credits pertaining to instance 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 be able to max of three younger children. 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. When the mortgage deduction is eliminated, as the President’s council suggests, the world will see another round of foreclosures and interrupt the recovery of structure industry.

Allow deductions for education costs and interest on so to speak .. It pays to for brand new to encourage education.

Allow 100% deduction of medical costs and insurance coverage. In business one deducts the price producing materials. The cost of employment is partly the upkeep of ones very well being.

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 All investment in stocks and bonds in order to deductable in support taxed when money is withdrawn using the investment markets.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

(Notes)

GDP and Taxes. Taxes can fundamentally be levied as the percentage of GDP. Quicker GDP grows the greater the government’s option to tax. Due to the stagnate economy and the exporting of jobs coupled with the massive increase owing money there isn’t really way the usa will survive economically without a massive increase in tax proceeds. The only way possible to increase taxes end up being encourage a tremendous increase in GDP.

Encouraging Domestic Investment. The actual 1950-60s tax rates approached 90% to your advantage 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 dual impact of accelerating 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 plenty of the freed income from the upper income earner leaves the country for investments in China and the EU at the expense of this US method. Consumption tax polices beginning globe 1980s produced a massive increase regarding demand for brand name items. Unfortunately those high luxury goods were more often than not manufactured off shore. Today capital is fleeing to China and Online ITR Return Filing India blighting the manufacturing sector among the US and reducing the tax base at a time when debt and an aging population requires greater tax revenues.

The changes above significantly simplify personal income tax bill. Except for accounting for investment profits which are taxed on the capital gains rate which reduces annually based on the length of energy capital is invested quantity of forms can be reduced to a couple of pages.