New-York tribune., 1919-03-29
Tax ON Income
Urged as Core
OF New System
No Other Way for State
to Meet a $53, 900, 900
Deficit, Declare Legis-
lators Who Back Plan

ALBANY, March 28-A state per-
sonal income tax was strongly urged
in the Legislature to-day as the core
Of taxation system to meet the pro-
spective loss Of excise revenues of $53,-
100000. Chairman Davenport, of the
Special Taxation Committee, which
framed the tax bills introduced to day,
said he estimated s5oooO,ooO would be
raised by such tax during 1919.
He suggested the revenues from the
special taxes proposed be divided
equally between the state and the
municipal communities. Chairman
Davenport added that as htcse revenues
might not suffice to solve tho local
municipal problem in New York City
low rate tax on tangible personal
property or an optional local business
tax might be imposed for distinctly
local purposes.
The bills introduced provide for
state income tax Of per cent, with
exemptions similar to the Federal tax.
an Increase of Il per cent on incomes
or corporations and a pcrmissive tax
on personal property tax above $4,000.
Locality Needs Considered
The problem before the committee"
the income tax bill, "was to obtain
revenue for a prospective deficit for
the coming year of approximately $20,-
O00,o0o Tor tho state and $33,O00,0OO
for the localities, total Of $53, 900 900.
II was necessary to take the needs of
the localities as we'll as of the state
government itself into consideration.
I'm investigating sources for new
revenue the committee found that rural
property in the state was bearing much
more than its share of the burden. 1t
found it is impossible to depend upon
taxation OF personal property as an
adequate source of revenue
"Suggestions were made to the com
mittee that the extension of the So
called indirect taxes, such as the in
heritance tax and others Of similar
nature, would provide the way out.
Upon investigation we found a few
more millions might reasonably be OBJ
taincd from certain of these indirect
sources. But it seems to the commit
tee that we cannot look here for any
thing like an adequate solution Of our
problem.
Income Tax Declared Just
And so we came, by the process Of
exclusion to the personal income tax
as the one which meets the need and
conforms to the demands Of justice and
fairness in taxation. The committee
earnestly recommends it as the core Of
! our system. There is no tax which so
brings the taxpayer to close quarters
with government revenues and expendi-
lures or so practically brings home to
him the responsibilities Of citizenship.
The income tax should be greatly
reduced in the nation and more and
more employed by the state. The rate
proposed Is fiat rate Of two per cent,
IN viaw Of the present very high and
| graduated Federal rate. While it is not
easy to make accurate forecast of the
expected yield Of any tax, the com
mittee is Informed by its experts that
two per cent rate should yield ap-
| proximately $50,000,000 which will sat
isfy the present needs Of the state
and leave in addition an adequate sum
for immediate relief of our great local
! municipal communities
"In the matter of the present tar
exempt securities Of New York State
as we'll as the securities subject to thu
present investment tax, the committee
proposes TO continue the exemption 70,
| existing securities in order to involve
no breach of faith, but it proposes to
tax further securities. We suggest the
distribution Of tho yield between the
state and the localities on a basis OF
oo per cent and 30 per cent.
"The income tax alone may fail tt
solve the local municipal problem. es
pecially in New York City, where over.
taxation Of real estate has become
acute. II this should provo to be the
case additional supplementary taxes
may bc imposed for distinctly loca
purposes, such as low rate tax or
tangible personal property or an op.
tional local business tax.
"The committee has had supple.
rncntary bills prepared covering those
two proposals also for the considers,
| tion OF the Legislature and the people
| Of the state"