You hear many politicians talk about it. The national debt is at $14-16T, programs like medicare and SSN are unfunded and the business environment is getting worse. So here is my plan to fix taxation and spending.
1. Federal Progressive Flat Income Tax:
Basically everyone is taxed that the same rate for the same money earned.
(1) 0-$25K = 0% Meaning for the first $25K that everyone makes is tax free!
(2) $25K-$50K = 5% The next $25-$50K is taxed at 5% (remember the first $25K is 0%)
(3) $50K-$150K =10% So on down the line
(4) $150K-$250K = 15%
(5) $250K - $500K = 20%
(6) $500K - $1mil = 30%
(7) $1 mil - $2 mil = 40%
(8) $2 mil+ = 49.5%
Deductions are charity, student loan interest, medical payments, mortgage interest and child deductions (max is 4). Nothing else. Why this works? First, every one is taxed the same at each level. Millionaires are taxed at 0-$25K, just as someone who makes only 0-$25K. No one is taxed at 50% of these income. There is always incentive to make more money, since every you are taxed at dollars above each level and not on the total once you hit the levels.
2. State Income Tax limits:
States shall be mandated to have a PURE flat tax. Under no circumstances can state income tax exceed 5%. 2/3 support in the house is required to get to 4%. A majority vote in the state is required to get it to 5%. Under no circumstances can it exceed 5% or go to a progressive tax.
3. Executive Stock Option Loophole:
This is simple close it! Close the stock option loophole that allows executives who makes millions of dollars and pay the capital gains not income tax. Capital gains is a ton lower and high level executives should not be able to avoid paying their income tax based on crafty accounting tricks.
4. Capital Gains:
Capital gains effects everyone who has a pension, IRA, 401K, mutual funds or any retirement plan. We should do what we can to INCREASE the amount of savings people get at retirement.
In addition capital gains hits people who invest in companies. The money invested has already been taxed. Either way the investor is allowing start up companies to start and other companies to grow. These type of investments stimulate the economy provides REAL jobs. Make it flat and progressive.
0-$100K = 2.5%
100K -$250K = 5%
$250K-$1 mil = 7.5%
$1mil+ = 10%
5. Property Taxes:
Make a Federal Law that imposes a California Proposition 13 on all 50 states. Yep back in 1978 CA made a picture perfect law!
http://en.wikipedia.org/wiki/California_Proposition_13_(1978)
6. Federal and State Pensions:
Make all collective pensions illegal. Devise a plan to pay current and soon to be retirees and get all State and Federal workers (including and esp teachers) into individual retirement plans with a employer match (aka 401k and IRA).
7. Move Social Security to the Chilean Model
This is a logical way to fix SS as it did in Chile. The Chilean model will save the government 100s of billions of dollars and will actually provide retirees more money. Chile has PROVED it's success. It's just the liberals demonize the word "private," at that should be a bad word.
Also, raise early retirement to 67.5, regular to 70 and give some type of incentive for retiring at 75.
5. Corporate Tax
Have Progressive Flat Corp Tax Rates with the manufacturing exception:
On bottom-line profits -
0- $500K = 2.5%
$500K - $1 mil = 5%
$1m - $5mil = 8%
$5mil> = 10%
Manufacturing exception - If 90% of the product is made in the US, then the corp tax may not exceed 2.5%.
Drastically reduce the amount of deductions made to offshore and increase deductions for onshore.
6. Eliminate Payroll Taxes, SSN and Medicaid Taxes and replace it with the 10% VAT and 1% national sales tax.
First, I know the VAT and sales tax are similar, however, they are different. Think about it, we PENALIZE employers for hiring employees with the 6.2% payroll tax. Then employees pay an additional income tax in the for of SSN/Medicare/Mediciad. Cut these taxes out and replace them with a 10% VAT (have the law state it can NEVER exceed 10%) and a 1% national sales tax (similiar state in the law it can't exceed that).
This revenue would be enough to cover Medicare, Medicaid, unemployment and SSN!
7. Sales Tax:
Mandate that state Sales tax can never exceed 7% and the national sales tax can't exceed 2% (sales tax shouldn't exceed 10% EVER)
8. Tariff
10% (or 20%) on Chinese goods
9. HealthcareThe government covers catastrophic coverage for all American citizens. Key American citizen no illegals.
Medicare covers from age 0-18 (including the child birth). Children can't provide their own healthcare, so they should be covered!!! Then it kicks back in at 75, but give incentives to holding off to age 80.
Have the government provide a large deductible (bascially covering catastrophic) and allowing people to "buy down on the deductible" via private insurance.
Age Levels:
0-18: No deductible. Medicare.
18-30: $25K Deductible. The so called healthy zone; higher potential out of pocket risk to the private insurer will be offset by healthier/younger insurance pool.
31-55: $30K deductible. Sickness zone, but also highest earning zone
55-65: $20K deductible. High sickness zone, but lower deductible to make up for lesser income potential.
66-74: $10k deductible. High sickness zone, low income potential, but we provide deductible relief due to limited income.
75-80: Medicare is available no deductible. However, if person opts out of medicare at until age 80, then gov provides some type of incentive.
81: Medicare
(10) Cut Most Gov Agencies Including Defense.
First cut the entire Federal workforce by 15% (as Ron Paul suggested)
Dep of Commerce: Still run patent and Census, but end subsidies to state and local gov (always ends in waste), restructure business subsidies to the manufacturing and R&D sector ONLY and don't make it based on race or sex (aka the discriminatory minority and woman owned businesses).
Agriculture: Still run food stamps and school lunch, end subsidies to mega farms (farm subsidies should only be to the mom and pop); end rural business subsidies (or keep it to mnfering)
Defense:
Cut defense! There is a ton of waste in it!
Dpt of Education:
Get it out of k-12 and have it concentrate SOLELY on college. College education requires reforming.
Dpt of Energy
Cut down to 1/4 it's size. Make it solely a fraud provention tool.
Dpt Interior
Cut out the Indian Affairs BS. Let the Indians handle it themselves. Have the primarily cover the water ways (which are important). Remove most of their duties on Fed Laws and have the states most run this.
Dpt Labor
End Employment and training programs. I have never heard anyone land a job from these programs and they are a giganitic waste of time. Reform the costly labor laws. End trade adjustment assistance.
SSN
Privatize SSN. We have seen it work in Chile. It doesn't drain the government coffers and th workers actually get 10 fold more at retirement (I think the official number was 7x). Have SSN provide for the disabled.
Transportation
Privatize the railroads and then watch them improve.
Combine the FTC, CFPB, SEC and other like institutions
1. Federal Progressive Flat Income Tax:
Basically everyone is taxed that the same rate for the same money earned.
(1) 0-$25K = 0% Meaning for the first $25K that everyone makes is tax free!
(2) $25K-$50K = 5% The next $25-$50K is taxed at 5% (remember the first $25K is 0%)
(3) $50K-$150K =10% So on down the line
(4) $150K-$250K = 15%
(5) $250K - $500K = 20%
(6) $500K - $1mil = 30%
(7) $1 mil - $2 mil = 40%
(8) $2 mil+ = 49.5%
Deductions are charity, student loan interest, medical payments, mortgage interest and child deductions (max is 4). Nothing else. Why this works? First, every one is taxed the same at each level. Millionaires are taxed at 0-$25K, just as someone who makes only 0-$25K. No one is taxed at 50% of these income. There is always incentive to make more money, since every you are taxed at dollars above each level and not on the total once you hit the levels.
2. State Income Tax limits:
States shall be mandated to have a PURE flat tax. Under no circumstances can state income tax exceed 5%. 2/3 support in the house is required to get to 4%. A majority vote in the state is required to get it to 5%. Under no circumstances can it exceed 5% or go to a progressive tax.
3. Executive Stock Option Loophole:
This is simple close it! Close the stock option loophole that allows executives who makes millions of dollars and pay the capital gains not income tax. Capital gains is a ton lower and high level executives should not be able to avoid paying their income tax based on crafty accounting tricks.
4. Capital Gains:
Capital gains effects everyone who has a pension, IRA, 401K, mutual funds or any retirement plan. We should do what we can to INCREASE the amount of savings people get at retirement.
In addition capital gains hits people who invest in companies. The money invested has already been taxed. Either way the investor is allowing start up companies to start and other companies to grow. These type of investments stimulate the economy provides REAL jobs. Make it flat and progressive.
0-$100K = 2.5%
100K -$250K = 5%
$250K-$1 mil = 7.5%
$1mil+ = 10%
5. Property Taxes:
Make a Federal Law that imposes a California Proposition 13 on all 50 states. Yep back in 1978 CA made a picture perfect law!
http://en.wikipedia.org/wiki/California_Proposition_13_(1978)
6. Federal and State Pensions:
Make all collective pensions illegal. Devise a plan to pay current and soon to be retirees and get all State and Federal workers (including and esp teachers) into individual retirement plans with a employer match (aka 401k and IRA).
7. Move Social Security to the Chilean Model
This is a logical way to fix SS as it did in Chile. The Chilean model will save the government 100s of billions of dollars and will actually provide retirees more money. Chile has PROVED it's success. It's just the liberals demonize the word "private," at that should be a bad word.
Also, raise early retirement to 67.5, regular to 70 and give some type of incentive for retiring at 75.
5. Corporate Tax
Have Progressive Flat Corp Tax Rates with the manufacturing exception:
On bottom-line profits -
0- $500K = 2.5%
$500K - $1 mil = 5%
$1m - $5mil = 8%
$5mil> = 10%
Manufacturing exception - If 90% of the product is made in the US, then the corp tax may not exceed 2.5%.
Drastically reduce the amount of deductions made to offshore and increase deductions for onshore.
6. Eliminate Payroll Taxes, SSN and Medicaid Taxes and replace it with the 10% VAT and 1% national sales tax.
First, I know the VAT and sales tax are similar, however, they are different. Think about it, we PENALIZE employers for hiring employees with the 6.2% payroll tax. Then employees pay an additional income tax in the for of SSN/Medicare/Mediciad. Cut these taxes out and replace them with a 10% VAT (have the law state it can NEVER exceed 10%) and a 1% national sales tax (similiar state in the law it can't exceed that).
This revenue would be enough to cover Medicare, Medicaid, unemployment and SSN!
7. Sales Tax:
Mandate that state Sales tax can never exceed 7% and the national sales tax can't exceed 2% (sales tax shouldn't exceed 10% EVER)
8. Tariff
10% (or 20%) on Chinese goods
9. HealthcareThe government covers catastrophic coverage for all American citizens. Key American citizen no illegals.
Medicare covers from age 0-18 (including the child birth). Children can't provide their own healthcare, so they should be covered!!! Then it kicks back in at 75, but give incentives to holding off to age 80.
Have the government provide a large deductible (bascially covering catastrophic) and allowing people to "buy down on the deductible" via private insurance.
Age Levels:
0-18: No deductible. Medicare.
18-30: $25K Deductible. The so called healthy zone; higher potential out of pocket risk to the private insurer will be offset by healthier/younger insurance pool.
31-55: $30K deductible. Sickness zone, but also highest earning zone
55-65: $20K deductible. High sickness zone, but lower deductible to make up for lesser income potential.
66-74: $10k deductible. High sickness zone, low income potential, but we provide deductible relief due to limited income.
75-80: Medicare is available no deductible. However, if person opts out of medicare at until age 80, then gov provides some type of incentive.
81: Medicare
(10) Cut Most Gov Agencies Including Defense.
First cut the entire Federal workforce by 15% (as Ron Paul suggested)
Dep of Commerce: Still run patent and Census, but end subsidies to state and local gov (always ends in waste), restructure business subsidies to the manufacturing and R&D sector ONLY and don't make it based on race or sex (aka the discriminatory minority and woman owned businesses).
Agriculture: Still run food stamps and school lunch, end subsidies to mega farms (farm subsidies should only be to the mom and pop); end rural business subsidies (or keep it to mnfering)
Defense:
Cut defense! There is a ton of waste in it!
Dpt of Education:
Get it out of k-12 and have it concentrate SOLELY on college. College education requires reforming.
Dpt of Energy
Cut down to 1/4 it's size. Make it solely a fraud provention tool.
Dpt Interior
Cut out the Indian Affairs BS. Let the Indians handle it themselves. Have the primarily cover the water ways (which are important). Remove most of their duties on Fed Laws and have the states most run this.
Dpt Labor
End Employment and training programs. I have never heard anyone land a job from these programs and they are a giganitic waste of time. Reform the costly labor laws. End trade adjustment assistance.
SSN
Privatize SSN. We have seen it work in Chile. It doesn't drain the government coffers and th workers actually get 10 fold more at retirement (I think the official number was 7x). Have SSN provide for the disabled.
Transportation
Privatize the railroads and then watch them improve.
Combine the FTC, CFPB, SEC and other like institutions
