Question

I have purposefully not provided a large selection of readings on this subject.   Research, on your own, the 2017/2018 federal tax reform package.    Make sure that you are using materials that are from December 2017 or later. The proposals to amend the law have been in flux before then, and an intelligent discussion requires the best, newest, information.

Discuss, using external resources to back up your assertions, how the new tax law changes the tax/regulatory/compliance burden on the entrepreneur.   Are the changes for the good? Or not? Please use the law - not politics - to inform your discussion.

Be sure of your sources - you need to present reasoned analysis, not emotional reactions. For instance, many articles will say that the tax reform is skewed towards "the rich" and is therefore bad on its face, without really giving any context or factual substance to support that position. Remember that the top 1% of earners pay 50% of all income taxes. And entrepreneurs, I presume, want to get into that group. Almost any tax reform package will impact the taxpayer that pays the most more than other taxpayers. I don't mind whatever position that you may take here - but it must be fact based - not emotional or based on "fairness" or "I feel" arguments.

Answer 1

ANSWER

FEDERAL TAX REFORM PACKAGE

Inorder to provide economic and social benefits to the people government needs a huge amount of money. The most important source of income of  the government to perform all such activities is tax. It is a financial charge imposed by the state to the individual.

There are two types of taxes-direct and indirect tax. Personal and Corporate income tax , property tax, etc. comes under this category. her hand Indirect taxes are imposed on consumption. Excise duty, VAT (Value Added Tax), etc. comes under this category.

Here we are discussing about tax reforms. It is a process of changing the mehtod of collecting taxes. It attempts to deal with external factors. The major features of tax reforms are lower personal income tax and higher consumption tax. Tax feforms helps to reduce tax evasion. It helps to keep the state revenue levlel stable and there by helps economic growth.  

A developing country like India a new tax reform policy came into existence. It can be undoubtedly called "honoring the honest" tax policy by all means.  

According to the new tax reforms the low and middle income groups get the amount of tax reduced to a certain extent. For single tax payers and married individuals the standard deduction rises upto 200 US dollars and for the head of the households and headof the institutions the standard deduction rises up to 300 US dollars.

Paying income tax is the most difficcult task each entrepreneur or business men as to face. While understanding the fact that it is the major source of income to the government it is our fndamental duty to pay income tax on time. It is always better to make bank transaction instead of paying direct cash. This is an intelligent step to reduce tax liability.  

Inorder to encourage private sector investment in public infrastructure like hospitals, highways, etc. income tax department provides multiple benefits to the entrepreneurss under section 35 AD which exists in certain countries, especially to those who are engaged in manufacturing sector. They used to get depreciation and soetimes even additional depreciation.  

The changes in the income tax system during the Trump administration period are the following. This is known as Tax Cuts and Jobs Act (TCJA). Under this act it is assumemed that by the end of 2025 it will affect a large number of tax payers who were enjoying the freedom under the  old tax reform policy which was much favourable to individuals.

These reforms will help to make indivual tax cut permanent. It will also encourage retirement savings and it may also lead to some type of business innovaions. What it is forecasted is that the federal deficit of hundred of billion dollars within a period of ten years.