Evening star., 1932-05-24

stitutional by the Supreme Court on
the ground that the tax was direct and
must be apportioned to the States ac-
cording to representation. About 18
years later the sixteenth amendment to
the Constitution was adopted, giving
Congress power to levy an income tax
without apportionment among the
States. The Federal Government, there
fore, has had a national income tax
since 1913.
Turning to the history of income tax
alton in the States, the bureau said
that in the decade following l840 seven
States had income tax laws, but most
of these laws became Intellectual because
OF poor administration and evasion" "
This, the bureau observes. led to their
years following the Civil War income
taxation made little gains.
AT the beginning of this century,
the report continues, "only five States
Massachusetts,. North Carolina South
Carolina, Virginia and Oklahoma-used
the tax, and even in some OF these its
abandonment was considered. Within
the next 10 years viewpoint favorable
to the income tax developed"
wisconsin Leads Change.
In 1911. the report continued, Wiscon-
sin enacted carefully prepared law on
the subject, designed to correct diff
culties that had befallen other States,
especially in regard to administration
"Other States" the bureau declares,
gradually followed. and in the last few
years the movement has had a signifi-
cant development, receiving added i'm
petus by the increased costs of govern
ment Today income tax laws are in
effect in nearly half of the States"
Turning next to its reasons for favor
ing substitution of an income tax for
the intangible personal property tax. the
report declares that tax on tangible
personality has met with only slight
opposition where the rates have been
reasonable, but that the intangible
property tax has been severely criti-
cized almost from the beginning, and
because Of well founded objections is
slowly being replaced
1T has been opposed" according to
the report, 'as being in effect a type OF
double taxation on the ground that in
an economic sense bonds, stocks and
like evidences in property rights are not
wealth but merely represent equities in
tangible or real property already sub
jected to taxation"
The bureau adds, however, that the
most serious objection ''is the fragrant
evasion of the tax" The report states
that. while Intangible property is easily
concealed, legislatures have hesitated to
give assessors broad investigational
powers
No satisfactory means are available
for determining the extent Of the eva
sion OF intangible property tax in the
District Of Columbia" the report goes
on. "A comparative statement of taxes
and assessments in % representative
cities (ranging in population from 252,-
981 to 900, ,42SD. found on page A of the
report of the Select Committee, shows
that washington has the second highest
assessment valuation Of personal prop
erty. being exceeded only by Baltimore,
city nearly twice its size. On intan-
gible property washington has the
highest assessment valuation.
Efficiency Is Seen.
These figures lead to the belief that
the District of Columbia has possibly q
more effective administration of the law
than any of the other cities in the
group. But this does not mean that a
large proportion of the intangibles are
taxed in the District.
"As the aggregate value of personal
property far exceeds that of real prop
erty, one might expect, taking into ac-
count the exemptions allowed in the
District personal tax laws. which in the
aggregate are relatively small, that the
valuation of personality would approach
that of realty. which is about sl,20O,-
100000. yet the assessed valuation OF
local personal property amounted to
only $650,000 900. Much of the diff
ference must have been made up of un-
much more difficult to locate for as
sessment purposes and is more easily
concealed
THE value Of intangibles in the Dis