Elements of the framework to boost economic growth are the lower corporate tax rate and expensing of business assets (either for a few years or permanently). Is that the only way to boost economic growth? Can more be done? Probably.
I raise this issue after reading a proposal from Congressmen Neal and Whitehouse:
H.R. 3499, Automatic IRA Act – “to expand personal saving and retirement savings coverage by enabling employees not covered by qualifying retirement plans to save for retirement through automatic IRA arrangements, and for other purposes.”
Their 9/26/17 press release states that they project that this bill could “boost national savings by nearly $8 billion annually.”
Is there some intersection of ideas here? Greater savings can also tie to investment in business expansion to help fund economic growth. And we know that people are not saving enough for retirement. Per the sponsors of HR 3499, about 90% of small to mid-size businesses do not offer retirement plans for their workers.
What do you think?
1 comment:
Among the so many parameters for measuring economic growth, job creation (associated with better standard of living), housing development are the two important ones that come to mind at this time.
If, as part of tax reform, the capital gains tax is raised, particularly on home sale (given that we already have the mortgage interest deduction benefit for home purchase), more houses could become affordable as we could potentially see a reduction in investor flip ups in the housing market; and the extra revenue generated could be thus used for developing more government sponsored homes at lower or affordable prices to the low to middle income citizens.
To promote personal savings, more interesting tax schemes such as zero tax upon withdrawal for long term retirement investment plans (for at least up to 25 years) could be made mandatory just as health insurance has been made mandatory under the Affordable Care Act.
Thank you!!
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