Tax Policy and Chill

Whelp, I was going to try to fund a Medicare for All system that I determined was good for business (go tell your corporation-friendly friends). Then I was going to write about Singapore's healthcare system. Then I thought about weighing in on the Veepstakes (it's going to have to be Elizabeth Warren if Biden wants her grassroots donor base). But, I came up against my own self-imposed deadline of "publish on a Monday or something," so it's going to be the thing I know about: mf tax policy that, dare I say, a Biden administration might like.

Income Taxes

For Liberals: This is going to increase taxes on the wealthy, making the tax code more progressive.

For Conservatives: This is going to make tax filing easier, making "filing on a postcard" a reality.

Tax Brackets

It starts with a return to the tax brackets we had before the 2017 tax cut. That leads to this outcome:

Tax Cuts Rate Normal Rates
10%10%
12%15%
22%25%
24%28%
32%33%
35%35%
37%39.6%

For the purposes of number crunching, I'm just going to pretend the 39.6% bracket is 40%, because it's easier. According to the Committee For a Responsible Budget, this would raise about $950 Billion in the next decade. First, I want to raise the top 4 brackets by 2% and the top 2 brackets by an additional 3%, which leaves us with this:

Tax Cuts Rate Normal Rates New Rates
10%10%10%
12%15%10%
22%25%10%
24%28%30%
32%33%35%
35%35%40%
37%40%45%

Having a 45% rate would put the US on par with the United Kingdom and other countries, so don't worry about international competition. According to the CBO, this would bring in $816 Billion over the next decade. Together, these would bring in $1766 Billion ($1.766 Trillion)

Deductions

The big thing that makes taxes so complicated is which deductions you'd want or need to itemize. How much did I give to charity? How much did I pay more than $12k in medical expenses? How much mortgage interest or student loan interest did I pay this year? No longer would we have to keep track of such nonsense. Everyone would just take the $12,000 + inflation every year. Simple. Doing this with these tax brackets would come close to the pre-2017 tax cut proposal (the tax brackets listed above are based on the pre-2017 tax cut) analyzed by the Congressional Budget Office.

This would bring in $2231.8 Billion over the next decade. In conjunction with the previous adjustments to the top few tax brackets, this would pull in $3997.8 Billion over the next decade.

We can also remove the Section 199A pass-through deduction for "Qualified Business Income" which, according to the Penn Wharton Budget Model, would raise $486 Billion in revenues. That, plus the previous total, would raise a total of $4483.8 Billion over the next decade.

Alright, that's the most work I want to do today. Have fun putting your nearly 4.5 Trillion dollars into Medicare or something.

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