Tax Deduction Proposal
Generally encouraging companies and people to employ other people should be rewarded. This country has for several decades penalized employers with hidden extra taxes of employer social security and employer medicare taxes. This really amounts to taxation without representation in order to hide the true cost of these programs.
I propose an additional tax deduction of 3 times the employer portion of social security and medicare taxes. This is based on the current tax rate 7.65%, a fair profit of 7% and that most companies expenses are 1/3 personnel, 1/3 supplies and 1/3 facilities. This works out to a factor of about 3 on the taxes. If only employer social security taxes are used the factor should be about 4.
This method of reducing employer taxes has several advantages:
* Little to no extra accounting.
* Promotes paying social security and medicare taxes over undocumented employment.
* Those with higher income would be encouraged to employ others.
* Increased competitiveness for hiring US employees over foreign workers.
* Incentive for larger companies to higher directly instead of subcontracting which would benefit unions.
* Employers could afford to give employees higher wages.
* It applies uniformly to help the economy without special interest and kickbacks.
* Less government spending on programs to locally increase employment.
The only objection may be less tax collected but it would shift taxes away from employers instead of non-employers.
Disclaimer: I would not directly benefit in any way as I do not currently or plan to employ anyone directly.
