Comment: Tax reform proposal: 1. The proposal provides for an income tax base for individuals and a consumption tax for businesses. 2. Exemptions for individuals include a dollar for dollar deduction for payroll taxes paid by the individual, reduction in gross income for charity deductions and a reduction in gross income for interest on the primary residency home up to $25,000 of interest expense per year (the $25,000 to be index by CPI), and a reduction in gross income for dividends. Exemptions for businesses include a dollar for dollar deductions for payroll taxes paid by the business for employees, a deduction of 100% on export sales. 3. Tax rate for individual income range: 0-50,000 10% 50,001-100,000 25% 100,001-500,000 30% 500,001+ 35% Tax rate for business would be set at 15% for added value 4. Tax collections for individuals would used the existing method of deductions from pay, quarterly estimates and final payments due by 4/15/xxxx Tax collations from businesses would be due quarterly with a reconciliation of value added calculations 5. Deficits: Congress would be required to balance the budget over its two year term by indexing the above tax rates to cover any deficit with 50% of the deficits covered by individual taxes and 50% by the business value added tax unless Congress declared that the USA was in a state of war. This proposal provides a simple progressive income tax for individuals, 4 brackets and 4 types of deductions. It provides a simpler tax for business with 1 rate and 2 types of deductions. Thanks for considering my proposal. Robert J Letourneau tel 513 509 8256 email rletourneau@cinci.rr.com |