Milford chronicle. [volume] (Milford, Del.) 1878-1974, 1929-02-08
INCOME TAX LAW
REVISION ASKED BY
PIERRE S. DU POINT
[COntjnued from first bageJ

were no burden whatever to SO per
cent of the population.
Nothing is more important to
the State than attracting and hold
ing wealthy citizens and corpora
tions," Mr.. dupont says in the re-
port. This can be best accom-
plished by fair and well prepared
laws, clearly expressed and justly
administered. Every taxable person
should be sought out and required
to pay tax. On the other hand the
tax department should refrain from
all endeavor to stretch the law be-
yond its clearly expressed words in
order to collect additional revenue.
If the law is insufficient, it is the
duty of the General Assembly, not
of the Tax Department, to make
changes.
Delaware offers few natural adj
vantages to prospective citizens
greater than those of many other
states but it can and should offer
the attraction of just laws, light in
burden and fairly administered.
Reasons For CapitatiOn Tax
For the above purpose it is best
that the capitation tax should be
levied for several reasons. First, it
is required by Article VIII, Section
: of the State Constitution: THE
General Assembly shall provide for
levying and collecting capitation
tax from every citizen of the State
of the age of twenty-one years or
upwards"
Second. If the income tax law
is to be fully and fairly administer
ed it is important that a list of all
persons over 81 years of age be
kept and checked for possible tax
ables. This can be best done thru
the capitation tax Third. 1t is fair
that all citizens should make con-
tribution toward the maintenance
of the public school system of the
State; no other State function is
more important and necessary. EV-
cry citizen has enjoyed its benefits.
Though some townships of adj
Joining States levy a capitation tax
of Sc, two dollars will be sufficient
for Delaware"
Mr.. dupont stressed in his report
that of equal Importance to the
State is the management of the cor
poration taxes. Many corporations,
he said, have been attracted to Della
ware as a domicile by twenty-years
of operation of fair laws.
Every effort, he said, should be
made to hold these corporations and
add to their number.
Sees Complicated Condition
He suggests that to this end the
CORPORATION franchise tax law
should be revised and the accepted
meaning made clear beyond doubt
so that those planning new corpora
lions may know from reading the
law all of its provisions.
Today, he said, the situation is
complicated by the existence of two
tax laws, one for corporations more
than one-half of whose capital is
employed in Delaware these cor
porations pay the Invested Capital
Tax, measured by capital employed},
the other for corporations more than
half of whose capital is employed
outside of Delaware, (these corpora
tions pay the franchise tax meas
ured by capital stock authorized.
The two laws, Mr. dupont recon-
mends. should be brought together
and all corporations taxed uniform
lv. This plan, he believes, Will
simplify the situation and relieve
the complications of a tax on cap
ital employed.
AS an offset to the proposed capt.
tation tax the tax on real estate for
school purposes may be abandoned
the report continued. This TAX was
reduced from % cents per $lOO TO
Is cents per 500 in 1927. BY TINS |
means real estate will be relieved OF |
all State school burden and the real |
estate tax will be left to the coun-
ties and incorporated places.
In recommending revision OF the
state income tax law, Mr.. DUPONT .
cautioned against any attempt to 4,
redraft the whole bill. To avoid err
rors. he said, no attempt to redraIt |
il in it's entirety should be made.
'In order to avoid hasty consld- !
Grafton of so important SUBJECT
tbe Governor appointed a Commls-
sion to make a study and solicit
carefully prepared bill to the LeglS-
lature," Mr.. dupont said.
ION July 10, 1928, the state Scnool
Tax Department offered to TINS
Commission a draft of law embody-
ing the present rulings of the De-
nartment and in addition certain
changes, namely:
"All dividends received by OF
credited to a taxable, Except dlVl-
dends paid from earnings accrued
nrior to January 1, 1920, are sub
iected to tax. (The law as now
svorded does not tax dividend
in a year different from that
in which payment is made.)
Deductions Allowed |
"Income taxes paid to the Federal
are made an allowable
deduction from income before cal
cnlating the State tax.
"Stock Dividends" are dehnltely
declared non-taxable.
CONSTRUCTION to Public WORK, OF
IN public or charitable institutions
in delaware are made deductlDie'
but not to exceed fifteen per ceiiC
of income.
Losses sustained from the opera
tion of farms and from ike puI-
suits are made deductible from III
come. AL o,,
Losses occurring through the en-
or guaranty OF notes OF
obligations are maue ue"''0'-
from income.
Though partnerships are not re-
ouired to pay income tax tney are
Obliged to report the names ana au-
dresses of the partners and the IN
o.,n Accrued OF diStrlDuted W