Evening star. [volume] (Washington, D.C.) 1854-1972, 1928-11-30
BALDWIN SCORES
INSURANCE LEVY
Declares "Unfair Burden" Is
Placed on PoIiCyhoIders
in District.

An unfair burden" is placed on in
surance policyholders in the District
through the special business tax levied
on insurance companies operating here
it was charged today by Thomas NJ
Baldwin, superintendent of insurance OF
the District
The statement was made in COM
menting on a report issued by the
Chamber of Commerce of the United
States that while the cost of operation
of the local insurance department for
the year 1927 amounted to $19,4l4, the
tax collected from the insurance COM
panies amounted to $346,595.
The difference between these two fig
ures. it was pointed out. amounting to
S327.I81, went into the general rev.
enues of the District to pay for bills of
the District government.
Opposes Special Tax.
While the business tax is levied
l@Seflst the insurance companies, the
Haior portion of it is borne indirectly
by the citizens of the District through
premiums paid on policies, MT. Baldwin
explained.
Il am unalterably opposed to imposi-
ton of such special tax on the insur-
holders here. the most of the revenue
of which goes into the general revenues
of the District" Mr.. Baldwin declared.
1.-THE tax should not be more than Suff1-
Gent to defray the expenses of running
the insurance department. In the last
analysis it is the policyholders, the ma
jority of whom are poor people or those
of modest salaries, who pay these spe-
cial insurance taxes ..
~ 49, fox
for the year 1928 have not yet been es-
timated but indications are that the
total will run above the $346,595 col
iected last year. the insurance superin-
tendent said
Mr.. Baldwin said that he had recon-
mended unsuecessfully that the spe-
cial tax rate of IL per cent of the net
premiums collected by insurance COM
panies operating here be reduced to
per cent in the new insurance code now
before Congress, as means Of reduc-
ing the burden on policyholders.
"Growing Tendency" Reporter.
A growing tendency on the part Of
the States to single out insurance pol
icy holders to carry, in addition TO the
taxes they pay as citizens, the heavy
burden of insurance taxes. is found by
the insurance department of the United
States Chamber of Commerce, accord
ing to its report just released for pub
lication.
"A study of special States insurance
taxes for 1927" the report states.
shows that such taxes are becoming
q constantly growing source OF general
rather than special revenue. Originally
intended to cover nothing but the cost
of insurance supervision in the interest
of the policyholders, a vast percentage
is now used for other purposes. In 1927
an aggregate of but $3,5t8. GA vas spent
for maintenance of the State insurance
departments: the remaining $8I ,044, 431
collected was used for purposes for
which the policyholdcrs had already
been taxed as citizens.
"a recent compilation of total State
revenues shows an aggregate OF approx
mately 81, 500 100000 Using this figure
as a basis, the special State insurance
tax for 1927, levied under the guise of
affording revenue for protection to the
insured alone, furnished more than 5
per cent of the funds for meeting gen.
eral State expenses in addition to per-
forming its own primary functions.
The excess funds derived from special
insurance taxation and paid into the
general revenue, IL used to purchase life
insurance protection would provide over
$50 for one year to every resident of
the United States, or if used for fire
insurance coverage would protect $10,-
O00, 100000 of property, an amount
equal to nearly per cent of all prop