Smart Tax
Free Money and Real Transparency allow us to simplify and streamline the tax code while simultaneously eliminating many of the distortions that have crept in under decades of Money Power delirium.
With one exception, we will eliminate all loopholes and deductions including tax free or tax deferred money pools, charitable deductions, the home mortgage interest deduction, and all corporate tax subsidies. We will entirely eliminate the concept of a “capital gains” tax rate by eliminating “two tier taxation” altogether – instead all corporate profits will flow through to shareholder taxes on a pro-rated basis where everyone will be taxed on a single “ordinary income” rate table. We will eliminate the payroll tax and shift estate taxes from the estate to the beneficiary (with a lifetime exclusion of $750,000 per beneficiary from all sources of inheritance or gift). Our one exception will be a $650,000 lifetime exemption for investment income, including interest income. This will provide a strong incentive for working people to save, without becoming the vast loophole for the rich that today’s IRAs and 401Ks have become.
Congress will, of course, have discretion to set specific tax rates. However, we will require that all income earners must pay at least some tax. Everyone has to pay their fair share. Indeed, because our ability to “follow the money” will be vastly improved with Free Money and Real Transparency, we will be able to come close to eliminating tax avoidance (Swiss bank accounts, Cayman island shell companies, etc.). Such tax avoidance is estimated to illegally shelter from tax nearly $1.3 Trillion dollars a year – money that the rest of us have to make up. This, combined with our other Smart Tax reforms of eliminating almost all deductions should enable rates in general to be substantially lower – while increasing both the equity and the ease of the tax system.