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The High-End Tax Break That Needs to Go
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  • Anthony

    Government in the United States (federal, state, and local) is a net dis-saver, meaning that current outlays (for consumption, interest payments or the public debt, and transfers) exceed revenues, currently around 2% of GNI. Will economic illiteracy trigger mounting budget imbalances? In other words, what really makes a win win (every president since Reagan has promised middle-class tax breaks and other tax breaks).

  • Observe&Report

    “Kludgeocracy”. Now that’s a word I’ve never come across before.

    • ——————————

      “A “kludge” is defined by the Oxford English Dictionary as “an ill-assorted collection of parts assembled to fulfill a particular purpose…a clumsy but temporarily effective solution to a particular fault or problem,” but I have difficulty in relating it to “kludgeocracy.”Dec 4, 2013”

      Yeah, TAI is full of surprises sometimes….

  • QET

    I expect that many high earners already effectively lose the benefit of the SALT via the Alternative Minimum Tax. So repealing it formally would be mostly symbolic.

    • WigWag

      That is correct. The AMT wipes out practically all of the tax deduction for state and local taxes paid by high income earners in high tax states.

      • Isaiah601

        I just did my taxes in NJ and ATM can suck a big fat one. The idea that a law would prevent government’s greedy paws in our pockets is silly. They will find a way to %@%$ us.

    • Fat_Man

      Yes. Big time. Indeed the SaLT deduction throws me into AMT most years.

  • Angel Martin

    For openers Trump should propose an end to state and local tax deduction, as well as reduce the mortgage interest deduction well below $1 mil (and eliminate the deduction for second mortgages). Also, charitable deductions need to be limited to a few thousand per year.

    If tax reform really is to help low income people, the first tax reduction should be the complete elimination of federal excise taxes on alcohol, tobacco and gasoline.

    In the past, liberals have proposed end runs around the 2nd amendment via massive excise taxes on guns and ammo.

    In that vein I suggest, 1000+ percent excise taxes on: men’s sandals, bicycles >$1000, non-business overseas air travel, imported wine, “medical” marijuana, and electric cars.

    In addition, raise the cost of a passport to $10,000 per year, and start taxing university endowments if they take foreign students or illegal immigrants.

    • Simpatica

      scr__ you AH

      • Angel Martin

        I forgot to include 1000% excise taxes on “drug paraphernalia”

    • Andrew Allison

      Quite apart from being the right thing to do, ending the state and local tax deduction (which amount to a wealth transfer from the Federal government to high-tax states) and reducing the mortgage interest deduction would put the screws to the limo-libs. Can’t agree about eliminating the second mortgage deduction, but a limit on total mortgage interest deductions (the sum of first and sceond mortgage interest) , i.e. a standard interest deduction makes sense. WRT charitable contributions; if somebody wants to give their money to charity, a deduction doesn’t seem unreasonable. Excise taxes on tobacco and alcohol have been shown to effective in reducing consumption, and the money raised might just possibly be used to mediate the outcome of abuse. The gas tax issue is best dealt with by mandating that it can only be used for road maintenance and improvement and not, as in the Socialist Republic of California, for bike lanes and nonsensical HSR.

    • f1b0nacc1

      Remove the business expense deductions associated with outsourcing…I am sure that the tech titans in SV (who were SUCH big fans of Hillary!) would get the message…

      • Angel Martin

        If they don’t, there is always anti-trust and tax stock options as ordinary income (they should do that as well as “carried interest”, regardless)

    • David Sher

      How does reducing taxes on alcohol and tobacco help poor people? It may put more money in their pocket short term but also shortens their life span.

      • markterribile

        That’s called freedom. And my experience is that many working poor use these because their jobs give them little personal reward and these are the little pleasure they get. Boosting taxes makes them suffer ‘for their own good’. I think they should make the choice, not their supercilious ‘betters’ who’ve never walked two yards in those shoes–and would often rather die than do so.

  • markterribile

    I’ve been saying for a few years now that the SUM of the SALT deductions should be capped at twice the median income for a family of four. Any limousine liberal who argues against that cap will show his true colors, but the number is high enough that hard workers who need the deduction will be unscathed.

    Kudos to Trump. I hope it’s done the right way. Pegging it, in the law, to that median income will make it harder to neuter.

    • David Sher

      In your analysis does cost of living matter at all? As for kudos for Trump, he has not achieved any legislative victory yet. Give him the credit when he does, not when he makes some bombastic announcement.

      • markterribile

        Keeping the deduction for the working classes makes all the sense in the world. But the limousine liberals who champion bloated budgets and help push taxes up should not be protected from the consequences of their actions. They, not the working people, can easily afford to move away.

  • Simpatica

    Oh BS. If you think doing this will improve calif government you are dreaming or dishonest.

    • f1b0nacc1

      This isn’t about improving it, this is about defunding it, a VERY different thing.

  • FriendlyGoat

    Tell me how much of this SALT-deduction revenue they give away eliminating Mr. Trump’s AMT and I’ll tell you what’s left in a cut for working families.

  • Pait

    This seems to reveal a certain amount of desperation in the attempts to finding some Trumpian proposal that has even a minute chance of not destroying the country. At least it has the merit of being amusingly creative.

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