Focus on Revenues
Invest in Technology / Infrastructure / Education Drive Sustainable Economic Increase / Improve Employment Growth = Improve Competitiveness
Consider Review Tax Rates Changing oe Reduce Subsidies / Tax Expenditures*/ eee Broaden Tax Base
KP www.kpcb.com USA Inc. | What Might a Turnaround Expert Consider? 395
Simple Tax Math* — Big Across-the-Board Tax Rate Increases Would Be
Needed to Potentially Generate Meaningful Revenue Improvements
Each one percentage point across-the-board tax rate increase would generate an incremental $127 billion revenue for USA Inc. in F2010E"...excluding any related
negative impact on spending / GDP growth, which is difficult to do... ...Which Would Reduce
Across-the-Board Hypothetical Revenue Increase for Fetimatad Lesees in Tax Rate Increase USA Inc. in F2010E ($ billions) F2010E by 1 Percentage Point $127 8% 2 Pereeniage $254 16% Points (pps) 3 pps $381 24% 4 pps $508 33% 5 pps $635 41% 10 pps $1,270 82%
Note: *The simple tax math presented here are pure mathematical illustrations — we simply calculated how big a broad-based tax rate increase (for
individual and corporate income, as well as payroll) would have to be for USA inc. to financial break-even. These calculations are merely mechanical
illustrations and are not meant to portray realistic solutions. 1) Incremental dollar amount calculated as 1% of projected total personal & corporate
KP income, which historically has been at ~87% of GDP. Source: F2010E revenue & deficit per White House OMB, GDP per CBO. (@E) www.kpcb.com USA Inc. | What Might a Turnaround Expert Consider? 396
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