Hello below is a tax plan that I worked on. It may not be perfect (I'm sure there is room to make some changes in the proposed tax bracket system)
But I believe this tax plan (or something similar) would be beneficial tax to the health of the American economy.
Monday, December 3, 2012
11. Income tax and capital gains tax will no longer be separate taxes
22. Below is the proposed tax bracket system
33. Enact a .005% transaction tax on stocks, options and derivatives.
44. Extend Angel Investor tax credit to cover LLCs,
The reasoning behind this proposal
11. By merging the capital gains tax with the income tax you will help create a more equal system. One should not pay a lower rate because they make their money from investments. By counting capital gains in the income tax you also increase the amount of revenue the Fed takes in.
22. This proposed tax plan was created not just to create revenue but also to help stimulate the economy. The plan gives a tax got to those in the lower income tax bracket because studies show that taxes to people in the lower income brackets is much better economic stimulus then a tax cut to those in the upper brackets. Economic stimulation is also the reason for the tax increase on the wealthy. While the poor and working class are stimulated by having extra money, studies show that higher tax rates causes the rich to help stimulate the economy. The reason is most likely due to the fact that if personal taxes are high instead of taking the money for themselves the wealth will reinvest there money.
I picked a top tax rate of 94% partly for historic reasons, it was the highest tax rate in 44/45 which was a time when we not only where in a war (as we are now) it was also a time we where still getting out of a recession (as we are doing now.) The high tax rate also gives room for future tax cuts.
33. The tax on stocks, options, and derivatives transactions is in place to create revenue. A study estimates that a tax like this could raise $350 billion dollars a year.
44. There is already a tax credit on the books for people that invest in upstart companies but it’s only for business that are registered as corporations the problems is a large number of business starting up are LLC. Extending this credit to business that are LLCs well help many small business option funding.