Reform excessive and intrusive taxation and regulation, keep check on wasteful spending. Unemployment numbers keep falling. They are the lowest in recorded history for many minority groups. We can see many benefiting from America’s booming economy – a father now a role model to his children by going out to work, a mother able to save for her kid’s college tuition with her new found job, and the graduate fresh out of college now able to pursue their dreams. They enjoy a job because reduced regulations, tax cuts, business growth, and less intervention by government bureaucrats have allowed for greater opportunity. However, the ‘Tax Cuts and Jobs Act’ has hurt New Yorkers, and exposed the hefty SALT burden we have. Our congressman should be working with Governor Cuomo and others in New York’s majority party to simultaneously reform the tax code and to lower our bloated spending. Instead, our leaders are looking for far-fetched loopholes for the SALT deduction, and playing more political games. I will go to Washington to influence a tax system overhaul.
On the federal level, I will focus on excluding items that do not belong in taxable income, distort the markets, and are especially burdensome to New Yorkers. Some examples of these are: the housing rent expense, insurance-approved out-of-pocket medical costs (deductibles, co-pays, etc.), and dividends paid from taxed corporate income.
The solutions I propose are the following:
Implement a tax deduction of housing rent. The rent we pay for our apartments is a necessary expense for our ability to maintain our jobs and produce taxable earnings. Unlike most personal expenses, housing rent cannot be accounted for via tax brackets, as rent prices are dependent on location (and they are highest in NYC). Hence, rent is taxed twice: as a non-deductible part of a tenant’s earnings, and as income to the landlord. Living in one’s own house prevents this double taxation: no tax is paid on the rent he (in effect) pays to himself. The existing housing tax policy fundamentally favors home owners over renters, and as a result depresses population mobility, thus contributing to unemployment rates and other social ills. I will advocate tax deductions for a tenant’s housing rent (excluding
expenses deductible to the landlord, e.g. electricity, heat, etc.).
Reform to taxing corporations and investors. Many constituents in my district hold stocks, directly or through mutual funds. Dividends and capital gains taxes have low rates but apply largely to income already taxed at the corporate level. This is widely criticized. Making dividends (paid from taxed income) tax-free and allowing companies to deduct capital losses on share repurchase would be more consistent than lower tax rates on dividends, capital gains, and corporate income. This would unfreeze capital mobility and speed-up the economy.
Make out of pocket medical costs fully tax deductible.The exorbitant price of our healthcare is often at odds with its quality. The prices are driven through the roof by a high demand of services, and the prices (paid by insurance companies, not by the client) are often not reflective of care received. This happens because people get insured against many risks they could easily handle themselves. This excessive insurance is encouraged by our current healthcare tax policy: insurance costs are pretax, while the out-of-pocket costs are taxed up to a high cut-off. To rectify this malady, taxpayers’ out-of-pocket medical costs approved by insurance (deductibles, co-payments, co-insurance, etc.) should be reported by insurance companies and be fully tax-deductible.
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