Provoq concept is GM's look at a fuel-cell electric vehicle for the luxury market..
THE ENERGY CONSERVATION AND ENVIRONMENTAL PROTECTION SOLUTION - MISSING IN OUR MID-EAST POLICY - Combined with two programs for the SOCIAL SECURITY FUND
- to repair equitably and fairly the SOCIAL SECURITY FUND's assessment of payroll taxes (SOCIAL SECURITY TAX) for employees and employers
- to resolve the future Insolvency of the SOCIAL SECURITY FUND. and provide for a Health Basic Care Tax to subsidize a Universal Health Care Program for all Americans.
A coordinated dividend from theses combined solution programs is a substantial automatic economic stimulus in jobs stamped "MADE IN THE USA."
This blog originally was part of THE CANDU MEMORANDUM for Iraq, is now being expanded and separately published.
It should be read by the President (and President to be), Congress, and the media.
It uses the Theory of Tax-Enomics, to produce solutions for both economic and social problems facing our country (note I am the founder of this theory and its foremost authority).
Mr. President, we are trying to steer the ship to you.
Obviously, our dependence on Mid East oil (which has now risen to $142 per barrel) to meet our domestic energy needs has very significant influence on our Mid East policies. We need to expand and find energy conservation and alternative energy sources to remove our dependence on imported Mid East oil and to improve our environment, including the issue of global warming. We need to bring the full and maximum utilization of alternative energy sources with more efficiency in all devices that utilize energy.
However, I would note here from one of the published comments to my blog on Iraq by Larry Sanazaro, that it is also needed for the government in parallel to the above to provide the necessary consumer and industrial incentives to vastly stimulate energy conservation and to substantially reduce consumer and industrial oil consumption.Additionally, many environmentalists have made a multitude of valid claims of damage to the environment from both fossil fuels and alternative energy sources. Nuclear power eventually may become very limited because we will run out of space on earth to store nuclear waste - certainly by the years 3000 and 4000.
Here are some suggestions for programs to provide solutions using the“Theory of Tax-Enomics”
ETHANOL VS. GASOLINE:
Today in many parts of the country we see particularly in the summertime that gasoline has 10% ethanol (thus the remaining 90% is gasoline derived from refined oil). What we need to see is 90% Ethanol and 10% gasoline. We can do this with the proper economic and tax incentives and the assistance of the Federal government by use of government grants. We need those pipe lines throughout the country, so that ethanol fuel from corn and cellulose from energy waste can flow easier to the consumer.
By utilizing significant tax incentives for the consumer and producer, ethanol gas (90% ethanol and 10% oil refined gas) could be produced in sufficient quantities and technological improvements to replace gasoline with only 10% ethanol as our primary source of energy for running motor vehicles and other public transportation. We need to get our airplanes to be able to utilize this (which I recently heard it now being tested for bio fuels) and other alternative energy sources, including nuclear power. The economic law of supply and demand will also improve the cost of these alternative energy sources, because the larger demand and supply could significantly reduce the unit cost of these alternative energy sources.
At this point I want to insert in to this blog an excerpt from a very recent news release:
Gulf Ethanol: Cellulose Efficiency Will Far Surpass Corn Based
EthanolHOUSTON--(BUSINESS WIRE)--Gulf Ethanol Corporation (OTC:GFET):
Recent studies by the U.S. Department of Agriculture (USDA) and
the University of Nebraska found that cellulose feed stocks can produce 540% more energy than is consumed in their production. Corn ethanol has been criticized by some as energy inefficient because it produces only 25% more energy than it takes to make it. Cellulose changes the energy equation for ethanol production. A five times energy output to energy input will make ethanol a very efficient renewable fuel.Farmers in Nebraska and the Dakotas participated in the five-year study by planting switch grass and carefully recording all costs for fuel, fertilizer, etc. The study concludes that ethanol production would equal 300 gallons per acre. U.S. News and World Report states, “If cellulosic ethanol becomes a widespread fuel, it would be a boon for agricultural regions.”
However, as noted by Larry Sanazaro in his comment alternative energy sources such as sugar cane, corn and other ground grown sources of alternative energy may eventually effect the balance of nature such as rain forests and their depletion. Perhaps, as example, some better consumer and business incentives to maximize the use of speed limit reduction to the 55 MPH, which in the past has proven to be a very effective way of reducing gasoline (refined oil) consumption.
SOLAR, WIND AND SEA POWER VS. OIL HEATING SOURCES:
These sources of power have been totally underutilized. Many people argue that the unit cost and effectiveness (particularly of Solar Power) limits the growth and significant increase in their utilization. I say the opposite particularly as to SOLAR for the following reasons:
SOLAR POWER
This is an alternative energy source appears to be unlimited in supply, which it my opinion makes it one of the best sources of alternative energy.
If we ask the question what will be our primary source of energy in the years 3000 and 4000 when we used up all the fossil fuels and bio fuels are limited or non-existant, because the world's poplulation has increased substantially more than 100 fold, Solar Power may be the only answer.
If this source of energy can be captured and stored cost effectively it could prove to be the most widely used alternative source of energy. Almost all other sources of energy that come from the earth including ground grown alternative sources may eventually, even if centuries away, be limited or non-existant in supply.
Imagine if we could store energy produced by Solar Power in sufficient quantities to heat and air condition our homes, businesses and government offices; to run our autos and trucks, perhaps even our ships and airplanes; to generate the power to run our businesses, industrial and government offices and plants; and all of our other energy needs. Imagine if we could have huge strategic reserves of stored Solar Power. I ask why trucks, cars, trains, airplanes and other transportation vehicles can not use Solar Panels on their roofs to gather Solar Power. All we have to do is find a way for the Solar Power to be stored more efficiently and magnified.
Obviously, this will take tremendous technology advancements to increase the efficiency and storage of Solar Power. Government and proper tax incentives could make this research possible , and the jobs should all be stamped "Made in the USA.".
I wish the President would have stated in the State of Union Speech, that the Federal Government, in partnership with all our State Governments ,would form a SOLAR WPA project that would produce within a 2 year period
1. 5,000,000 Solar Panels to be put on the roofs of all our government buildings including all military bases.
2. 20,000,000 Solar Panels to be put on the roofs of office buildings, schools, universities, and apartment buildings.
3. 25,000,000 Solar Panels to be put on the roofs of resident homes.
It has been said that it takes 9 weeks to train a worker to be able to produce Solar panels. The workers hired to do so would receive a one year contract for work, which would include the 9 weeks of training.
All these jobs under this program would be stamped "MADE IN THE USA." All Solar Panels would be manufactured domestically to provide additional jobs stamped "MADE IN THE USA". The manufacturing material cost of the Solar Panel project would be substantially reduced by granting special investment tax credits and availability of government financing using low rate tax free government bonds to the manufacturers of the Solar Panels for meeting increased production of reasonably priced Solar Panels.
The financing for the entire cost of labor and materials for the installation of the Solar Panels for the non-government sector could be accomplished as follows:
1. The Panels would be installed where they would have all the power produced from Solar Panels would be transferred back and sold to the respective Utility companies. It would be sold back to the Utility companies at the same rate they are charging the respective consumer. There would be two meters on each property. The existing usage meter and a new meter for the sale of power to the utility companies, which would be subject to computerized government monitoring. As the power generated by the Solar Panels is immediately transferred to the utility company, there is no necessity to store it at the property owner's location.
- 85% of the Power sold by the consumer to the Utility company would be applied to the utility's maintenance cost for the panels and the actual financial cost of the Solar Panels until fully paid for including the financing cost (the interest to carry the principal). This financial cost would be a separate government mortgage on the respective property and title to the Solar Panels would be held by the government until fully paid for.
- It would use tax free low interest rate government bonds (both Federal and State, and not subject to AMT) to provide low cost financing through the FHA, Fanny Mae and Freddie Mac for the installation of Solar Panels on the roofs of residential homes. This will add value to all homes acquiring Solar Panels. There would not be any out of pocket outlay cost by the private sector property owner.
The expansion in the manufacture of these panels will produce domestic "MADE IN THE USA" jobs. With an increase in technology applied to this manufacture of Solar Panels, these USA manufacturers could become substantial exporters in the future of these products to other countries that want to expand their alternative sources of energy to USA manufactured Solar Panels.
4. 25,000,000 Electric or HYBRID Autos - all made in the USA which will be financed to the owners with tax free government bonds. Vehicles will have to get better than 40 miles per gallon and cost with normal equipment not more than $15,000. Special Tax credits will be issued to both the consumer and US manufacturer (all vehicles must be made and or assembled in the USA with JOBS stamped made or assembled in the USA). Two good examples, except for their current cost, of the ideal car would be:
- A. The Tesla AC Current all electric vehicle has a torque that makes this vehicle "the highest 30 to 70 miles acceleration of a car ever made (tested." This car "has an aluminum extrusion body and carbon fiber top."Above INFO REPRINTED from AOL and Google. An expensive electric vehicle with all the right ideas, but very costly at present.
The Provoq concept is GM's look at a fuel-cell electric vehicle for the luxury market. The Caddy Provoq is an all-electric production, using the fifth generation of GM's fuel-cell and two large hydrogen fuel tanks to make electricity for the lithium ion batteries and electric drive motor.
According to GM's spec sheet, the crossover-styled Caddy can travel 300 miles on a 6 kilogram hydrogen fill-up, 20 of it run in all-electric mode from the grid-charged batteries. (A kilogram of hydrogen compressed at 10,000 pounds per square inch is the energy equivalent of approximately one gallon of gasoline).
Once the initial battery charge is depleted, the Caddy's E-Flex system relies on juice produced in the fuel cell (which mixes hydrogen with oxygen to make electricity) to power the all-wheel drive vehicle's electric motors – one driving the front wheels and a pair of individual wheel-mounted motors in the rear.
The system can produce up to 88 kilowatts of power, a 10 percent increase from the system shown just eight months ago in Shanghai, and uses a 9 kW-hour battery pack with 60 kW peak power, versus an 8 kW-hour, 50 kW peak pack in the Shanghai version.
GM claims a zero-60 mph acceleration time of 8.5 seconds for the Provoq, with a top speed of 100 mph.
The concept uses lots of recycled and recyclable materials, features a brake-by-wire system that eliminates brake hydraulics, and has low-rolling-resistance tires from Michelin and solar panels in the roof to help generate power for auxiliary items such as the audio system and air conditioner.
- Producing alternative energy vehicles such as the Tesla and the Cadillac Provok will be costly initially. However, if the technology used in these vehicles were adapted in a more mass produced US made vehicle with government subsidies and tax exempt financing and by tax credits to the producer and consumer it would make these vehicles a very desirable cost effective alternative to the current gas guzzlers. In the short term, we need a massive program nationwide to facilitate the use of natural gas for transportation fuel consumption. It is true we may have Bio Fuels, including synthetic bio fuels for many generations to come. However, they will be competing for other uses.
As Solar Energy from the sun is unlimited as an energy source, it probably is our best solution to find sufficient and unlimited domestic alternative energy without producing global warming or an in balance of nature. It should be noted that I have heard there is a new technology currently in use in Israel and in A section in California that makes use of mirrors and thinner Solar Panels. Additionally, infra-red rays from the Sun have been used.
An interesting way to increase the effectiveness and decrease the unit cost of SOLAR POWER has not been exploited (except by a firm I believe in Texas from a rumor I heard).
It is very simple. Do you remember when you were a child, someone would take a magnifying glass on a sunny day and get a piece of paper on the ground to burn? Well that was energy. Maybe we could find a way to increase effectiveness of SOLAR POWER and the condensed storage of SOLAR POWER by the use of magnification?
Another idea would be Solar Panels on the roofs of all trains and container trucks. All we have to do is find a way to safely and cost effectively capture and store the energy heat generated by these roof solar panels With trains, they may be able to transmitt the power back immediately as generated thru the rail system.
My ideas - but if someone spends the money maybe they could be made to work.
WIND AND SEA POWER:
Two additional sources of very powerful energy that has been totally underutilized. These two alternative sources of energy also appear to be of unlimited supply, but may be harder to control their intensity and frequency. However, they do appear to not cause any in balance to nature by their use.
Obviously, the effectiveness for utilizing these two energy sources is presently limited by the unit cost to the consumer and producer. However, the unit cost is significantly decreased by a massive increase in their utilization. Also we need significant technological improvements to decrease the unit cost.This is where the Federal Government via a tax incentives and grants to US businesses in this field would have huge benefits.
Also significant increase in the utilization of all of the above energy sources will have other positive effects to our economy and our environment such as:
1. A positive effect on global warming. All of the above would have significant positive effects on the global warming problem that our children, grand-children and future generations will be facing.
2. The economic benefit of utilization of American workers to produce locally this energy source could be a major source of "MADE IN USA" jobs and employment in the US, which would help our local economies grow, and at the same time will increase our base of taxpayers and thus increase tax revenues (without increasing tax rates) at both the Federal, State, and local levels.
3. The reversal of our trade balances with external oil producers from the Mid East, South America and elsewhere, thus pouring US dollars back into the US economy instead of the pockets of foreign oil producing countries. It should be able to remove our dependence on the importation of fuel oil within a two year period if we put the full SOLAR WPA PROGRAM into effect, if this program is combined with nationwide expanded program to produce reasonably priced electric autos.
Some people would say this is too expensive and too costly for our government to massively utilize these alternative energy sources ( that have unlimited quantities, far in excess of all of the oil reserves). The cost of not to do this is far more expensive, particularly if in future generations we run out of fossil fuels or caused excessive global warming.
"Green Jobs" used in implementing such energy saving devices, such as installing and manufacturing Solar Panels, will ultimately significantly reduce the cost of increased utilization of these alternative energy sources, and these jobs would be stamped "MADE IN THE USA".
There are other parts of this solution that here that could have several very positive effects on our economy described as follows:
Some have called for the privatization of the Social Security Fund Accounts. Those that have argued against privatization argue that the Social Security Fund should be untouchable and retirees; benefits if not paid to some would generate the need for more public welfare as an offset for lost benefits.
Well, we could do a compromise with no risk to the retirees, but a way to significantly increase the Social Security Fund and protect our consumers and the economy from price gouging by foreign oil producers.
Here is the TAX-ENOMICS proposal:
A. The Federal Government would transfer financial ownership of the strategic oil reserve to an investment fund to be owned by the Social Security Fund. Annually, the Federal Government - Congress and the President as part of our annual budget would appropriate and transfer sufficient funds to this investment fund sufficient to increase the strategic oil reserve by 5%.
- Whenever the price of oil would drop low enough, this investment fund of the Social Security Fund would buy in the open market from the new funds appropriated, additional oil (or possibly oil futures) for the Strategic Oil Reserve.
- Whenever the market has the artificial rises in the price of oil the investment fund of the Social Security Fund will sell off a portion of its strategic oil reserve in the open market at the higher prices (LIKE THE RECENT RISE TO $100 A BARREL) to force the price of oil down by increasing the oil supply domestically. At the same time this investment fund of the Social Security Fund will turn a tidy profit for the Social Security Fund. MORE POWER FOR THE BUCK INVESTED.
- Again we would have a compound effect of generating additional and higher income for the fund and encouraging with government financing the consumer and business investment in alternative energy sources and equipment.
In both cases the Federal Government would be a guarantor for the Social Security Fund's investment to protect it from any loss, which under the above plans should never happen.
It is somewhat similar, but uniquely different than Senator Barack Obama's proposal for uncapping the Social Security tax.
Briefly recapping the present structure, we have a 6.2% FIXED RATE Social Security Payroll tax assessed separately for both employee and employer against all earned income (salaries and wages) with a cap now at $97,500.
For everyone below this present $97,500 thresh hold this payroll tax is a 6.2% payroll tax withheld of their gross earned income. In some cases at the lower end, this a larger tax than the income tax assessed the taxpayer.
For everyone above this $97,500 thresh hold this tax is a declining variable rate of their gross income earned. See the following chart, which shows the drastic declining rate of payroll tax percentage of gross earned income earned above the present tax threshold of $97,500:
<-------------PRESENT-------------->
FICA*******EARNED******FICA
TAX *******Income*******SS Tax
RATE***** Tax Base*****TAX WH
6.20% $****5,000.00 $***310.00
6.20% $***10,000.00 $***620.00
6.20% $***15,000.00 $***930.00
6.20% $***20,000.00 $*1,240.00
6.20% $***25,000.00 $*1,550.00
6.20% $***30,000.00 $*1,860.00
6.20% $***35,000.00 $*2,170.00
6.20% $***40,000.00 $*2,480.00
6.20% $***45,000.00 $*2,790.00
6.20% $***50,000.00 $*3,100.00
6.20% $***60,000.00 $*3,720.00
6.20% $***70,000.00 $*4,340.00
6.20% $***80,000.00 $*4,960.00
6.20% $***90,000.00 $*5,580.00
6.20% $***97, 500.00 $*6,045.00
6.05% $**100,000.00 $*6,045.00
4.84% $**125,000.00 $*6,045.00
4.03% $**150,000.00 $*6,045.00
3.45% $**175,000.00 $*6,045.00
3.02% $**200,000.00$*6,045.00
2.42% $**250,000.00 $*6,045.00
2.02% $**300,000.00 $*6,045.00
1.73% $**350,000.00 $*6,045.00
1.51% $**400,000.00 $*6,045.00
1.34% $**450,000.00 $*6,045.00
1.21% $**500,000.00 $*6,045.00
1.10% $**550,000.00 $*6,045.00
1.01% $**600,000.00 $*6,045.00
0.93% $**650,000.00 $*6,045.00
0.86% $**700,000.00 $*6,045.00
0.81% $**750,000.00 $*6,045.00
0.76% $**800,000.00 $*6,045.00
0.71% $**850,000.00 $*6,045.00
0.67% $**900,000.00 $*6,045.00
0.64% $**950,000.00 $*6,045.00
0.60%$1,000,000.00 $*6,045.00
Accordingly, from this chart, it becomes obvious that this payroll tax is a MINIMUM HIDDEN AMT TAX FOR ALL TAX PAYERS EARNING LESS $97,500 with absolutely (unless self-employed) no deductions available. It is a declining rate and disappearing NON AMT Payroll Tax for all Taxpayers earning more than $97,500.
It is interesting that throughout history the income tax laws (both Federal and State) have a graduated tax rate that basically increases in its tax rate as the net taxable income of the taxpayer increases. The lower the net taxable income subject to tax, the lower the rate. Someone, when they designed the income tax rates seemed to feel that the taxpayer with little taxable income could ill afford to pay a higher rate of tax than the taxpayer with a larger taxable income.
However, when you look at the chart above, the designers of the Social Security tax, which rates have substantially increased since its inception, developed a tax that is at a higher rate for the people least able to afford and pay it.
Now we also must recognize that the employer of the taxpayer bears a matching portion of this tax.
To the employer this payroll tax he bears is a PAYROLL TAX EXPENSE that adds no value to the employers goods and services produced. This payroll tax expense under the present program is also a deterrent to economic growth because in some cases, it is cheaper sometimes to employ a few high paid employees to replace several lower paid employees.
It substantially increases the cost of doing business and in some cases, because of its cost have put some employers out of business.
Not withstanding, the present program has come about using the principal that today's payers of the payroll tax will pay the present retirees benefits. This only works in the long run when the tax base expands at a greater rate than the expansion rate of benefits paid out currently. Our impending crisis in the future solvency of the Social Security Fund looms above us now is that the benefits being paid out and to be paid out are increasing at a higher rate than the payroll tax revenues being received by the fund.
Now let us look at a unique possible solution to revising in a fair manner the assessment of this payroll tax against the employee and the employer. A fair manner for assessing the employee his share should be at a graduated rate, so that this AMT Payroll tax on earned income, will be assessed more on the ability of the taxpayer to afford and to pay the tax. We would also like to find a way to increase domestic employment with an increase in new jobs stamped "MADE IN THE USA". At the same time we would like to ease the employer's burden of this payroll tax expense, so that his cost of using domestic labor - jobs stamped "MADE IN THE USA" is decreased. At the same time in finding a way to revise this tax, we must find a way or ways to match the benefits paid out to the payroll tax revenue assessed and received. If not matched, at least a lot closer than the present disparity.
Well now I have given you a perfect wish list for what appears as an impossible solution, I have a surprise for you. It is possible using the principles of the Theory of Tax-Enomics (see my separate blog).
- The key here is to increase the tax base by increasing sufficiently the number of taxpayers. At the same time decreasing effectively the payroll tax rates used in assessing both the employee and the employers Portions of the tax.
If we change the present PAYROLL TAX FIXED RATE of 6.2% to a graduated rate with no caps for the employee and or the employer, we will have a far more equitable method of assessing this payroll tax rate based more on the ability to afford and pay the tax. Simultaneously, it will stimulate domestic economic job growth in additional new jobs stamped "MADE IN THE USA".
- The result to the employee earning $97,500.00 or less will be that this taxpayer is paying a lower rate of PAYROLL TAX and therefore will have more disposable income to pay his bills with, to pay his mortgage with, to save, to pay off his consumer credit, and to spend in domestic consumption which stimulates local economic local growth.
- The result to the employer is that his payroll tax cost per employee is lowered so that the employer is encouraged to hire more employees at the lower salary levels, than one highly paid employee at higher salary levels.
The Chart below proposes a graduated tax rate with a lower starting rate - similar to the manner that most income taxes Federal and State tax income. It will still be a Minimum "AMT" Payroll tax, but it is assessed in a more equitable manner.
This chart with its proposed graduated rate will provide substantial relief to middle and lower income tax payers, who desperately need the tax relief. However, it will actually increase tax revenue flowing to the Social Security fund. because it will be cost effective to hire, for example two $50,000 employees, rather than pay one employee $100,000 thru overtime etc.To defeat the argument that this tax program now excessively taxes the richer taxpayers earning more than $200,000 a year with no increase in Social Security benefits, the program would have two other provisions:
Any tax collected above $6,500 level in any year from the employee would be allowed as a non-refundable, but carry forward credit, towards the AMT Income Tax. Any used credits for taxpayers over the age of 65 would become eligible to be applied to regular income tax as a non-refundable credit. (This will help Seniors needing any income tax relief).
Self-employed Taxpayers (who pay 12.4% SE TAX - the employee and employer portions) would be capped on their Self Employment income at $200,000 - $6,500.00.
The employer portion (expense portion of the tax to the employer) would be capped at $9,750 per employee (the amount assessed against an employee earning $300,000.00).<------------------PRESENT-------------------><---PROPOSED---->
*************Earned
FICA SS**** INCOME********FICA SS******><*FICA
Tax Rate***Tax BASE*******TAX**********><*Tax Rate*Tax*>
6.20% $****5,000.00***$****310.00******2.50%$****125.00
6.20% $***10,000.00***$****620.00******2.55%$****255.00
6.20% $***15,000.00***$****930.00******2.60%$****390.00
6.20% $***20,000.00***$**1,240.00******2.65%$****530.00
6.20% $***25,000.00***$**1,550.00******2.70%$****675.00
6.20% $***30,000.00***$**1,860.00******2.75%$****825.00
6.20% $***35,000.00***$**2,170.00******2.80%$****980.00
6.20% $***40,000.00***$**2,480.00******2.85%$**1,140.00
6.20% $***45,000.00***$**2,790.00******2.90%$**1,305.00
6.20% $***50,000.00***$**3,100.00******2.95%$**1,475.00
6.20% $***60,000.00***$**3,720.00******3.00%$**1,800.00
6.20% $***70,000.00***$**4,340.00******3.05%$**2,135.00
6.20% $***80,000.00***$**4,960.00******3.10%$**2,480.00
6.20% $***90,000.00***$**5,580.00******3.15%$**2,835.00
6.20% $***97,500.00***$**6,045.00******3.20%$**3,120.00
6.05% $**100,000.00***$**6,045.00******3.25%$**3,250.00
4.84% $**125,000.00***$**6,045.00******3.25%$**4,062.50
4.03% $**150,000.00***$**6,045.00******3.25%$**4,875.00
3.45% $**175,000.00***$**6,045.00******3.25%$**5,687.50
3.02% $**200,000.00***$**6,045.00******3.25%$**6,500.00
2.42% $**250,000.00***$**6,045.00******3.25%$**8,125.00
2.02% $**300,000.00***$**6,045.00******3.25%$**9,750.00
1.73% $**350,000.00***$**6,045.00******3.25%$*11,375.00
1.51% $**400,000.00***$**6,045.00******3.25%$*13,000.00
1.34% $**450,000.00***$**6,045.00******3.25%$*14,625.00
1.21% $**500,000.00***$**6,045.00******3.25%$*16,250.00
1.10% $**550,000.00***$**6,045.00******3.25%$*17,875.00
1.01% $**600,000.00***$**6,045.00******3.25%$*19,500.00
0.93% $**650,000.00***$**6,045.00******3.25%$*21,125.00
0.86% $**700,000.00***$**6,045.00******3.25%$*22,750.00
0.81% $**750,000.00***$**6,045.00******3.25%$*24,375.00
0.76% $**800,000.00***$**6,045.00******3.25%$*26,000.00
0.71% $**850,000.00***$**6,045.00******3.25%$*27,625.00
0.67% $**900,000.00***$**6,045.00******3.25%$*29,250.00
0.64% $**950,000.00***$**6,045.00******3.25%$*30,875.00
0.60% $1,000,000.00***$**6,045.00******3.25%$*32,500.00
BENEFITS FROM THIS PROGRAM OF GRADUATED FICA SS TAXES:
- Immediate substantial tax relief to all taxpayers with earned taxable income earning less than $200,000 per year (both employees and Self-employed taxpayers), with an equitable adjustment for those earning over $200,000 per year. The tax is now being assessed more on the ability to afford and pay the tax.
- Immediate substantial tax relief to businesses with employees earning less than $200,000 per year. The relief is so substantial a the lower end, that it will encourage businesses to hire more employees and thus create new jobs - stamped "MADE IN THE USA".
- From the increase in the number of new taxpayers earning and contributing to the Social Security System (as incentified by the program's lower rates for employers hiring an increase in lower income taxpayers), and from the higher amounts of Social Security tax collected from upper income high paid employees (who can better afford the increased tax) will offset the lower amounts collected from the lower to middle income taxpayers earning less than $200,000. The "golden parachutes" will have a little less gold.
As part of the above program, as a means to help subsidize a Universal Health Basic Care Program, the employee and the employer would now each be assessed each a 1.45% "Health Basic Care Tax", with no cap. Although some might consider this new payroll tax an "AMT" tax, it is being assessed equitably at the same tax rate to all taxpayers with earned income, who are benefiting from the tax.
This Health Basic Care Tax would be assessed against Unemployment Insurance Benefits at the rate of 2.9%.
Social Security Benefit holders who are not eligible for Medicare (under age) would be assessed the same Health Basic Care Premium as Medicare Recipients.
The proceeds of the tax would be used in a Universal Health Basic Care Program, that would operate similar to the medicare program. Employers would be able to lower their regular health care costs, because this new Health Basic Care Tax would be the premium for the Health Basic Care Program. The program would provide for Universal Basic Health Care and major desease health care.
Employers, at a substantial savings to their present health care costs, could offer or pay for a group Health Care Medi-Gap Program (similar to the AARP Medi-Gap Program) , that would pickup medical costs not paid for by the Health Basic Care Tax Program. One of the advantages of this program would be the reduction in paper work for the insured.
This program could bring Universal Health care in a combination of the two programs - Health Basic Care Program and the Health Care Medigap Program to be economically affordable and equal to the Congressional Health Insurance Program (presently available to Senators and Congressmen). The Health Care Medi-Gap Programs would be able to bring medical insurance costs to be more competitive.All other cost saving steps, such as, but not limited to, digital medical records and national negotiation of insurance and medical costs, to reduce overall medical costs should be used where ever possible. There should be a high tech overseer program to that would monitor any abuses within the system. With technological advanced digital medical records and insurance coordination, this will be a major part of keeping medical costs from being abused.
MEDICARE CARE TAX AND MEDICARE/HEALTH BASIC CARE TAX JOBS CREDIT
At this point it should be noted that we did not bring the 1.45% Medicare Tax into this program as it is now being assessed equitably with no caps on all taxpayers with earned income. Thus all taxpayers, bear the tax at the same rate. True, it is an AMT Payroll tax, but it is equitably shared by all taxpayers assessed who will benefit from the Medicare Tax.However, the employers who also bear the 1.45% Medicare tax and the 1.45% Health Basic Health Care tax as an expense with no caps, should be eligible to receive a JOBS CREDIT for an increase in new hires (New Jobs stamped as "MADE IN THE USA").
EXPLANATION OF MEDICARE-HEALTH CARE JOBS CREDIT:
The JOBS CREDIT would establish the prior calendar year as the base year for base QUALIFYING wages.- The base QUALIFYING wages would be all Medicare/Health Basic Care Taxable Wages from Employees earning LESS than $50,000 per year in the PRIOR taxable year.
- Eligible JOBS CREDIT wages would be all Medicare-Health Basic Care Taxable Wages from Employees earning LESS than $50,000 per year in the CURRENT taxable year.
- The JOBS CREDIT would be equal to 50% of the INCREASE in the TOTAL MEDICARE TAX AND HEALTH BASIC CARE TAX PAID ON THE INCREASED MEDICARE WAGES PAID IN THE CURRENT YEAR.
- The JOBS CREDIT would be computed as part of the year-end Federal Income Tax form ( a very simple 1 page form). The credit could be applied as a NON-Refundable Income Tax Credit or by the Employer as credit on the quarterly payroll tax form (FM.941) as a NON-Refundable credit not to exceed in any quarter the amount of Medicare Tax reported on the form. The credit would be charged by US Treasury against the General Fund, not against the Social Security Fund or the Medicare Tax Fund.
It should be noted here that all of the above tax programs produce for both the employee and employer each
1. A NEW COMBINED PAYROLL TAX RATE of a maximum of only 6.15% (3.25% SS Tax +1.45% MC Tax +1.45% HBC Tax) compared to the PRESENT COMBINED PAYROLL TAX RATES of 7.65% (6.20% SS Tax +1.45% MC Tax).
2. For wages below $100,000 per year the NEW COMBINED RATE DECREASES DOWN GRADUALLY to as low as 4.95%.
Thus by increasing the Tax Base equitably for taxpayers, Combined Payroll Tax Rates, including a new Health Basic Care Tax, have actually been substantially reduced with new benefits added (Basic Health Care). The program should stimulate and create jobs domestically ("MADE IN THE USA").
In summary the above programs, using the principles from The Theory of Tax-Enomics provide solutions to many inter related Economic and Social Problems facing the President (and President to be) and Congress primarily as follows:
The programs are specifically designed to INCREASE the Taxpayer Base, and Lower the Tax Rates for Middle and Lower Earned Income Taxpayers, and economically stimulate domestic employment and domestic consumption. At the same time the above programs will be the major step towards Universal Health Care, without burdening the employer and employee. They should bring jobs back to the US by effectively lower business payroll tax and health care costs.- Programs for expansion of Energy Conservation and Environmental Protection, with economic benefits of an increase in domestic employment (Jobs stamped "MADE IN THE USA"), improvement in our balance of trade, economic savings for the American Taxpayer Consumer, and a substantial reduction in the domestic consumption of imported refined oil.
- Programs to bring solvency to the Social Security Fund, without privatization, and equity to the assessment of this AMT Payroll Tax on the employee, employer and the Self-employed.
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