The Ely miner. [volume] (Ely, Minn.) 1895-1986, 1937-03-18
MILLER POINTS
TO DANGER In
TAX MEASURE
Bill Before Legislature Would
Make Minnesota Highest
Income Tax State.

With the Minnesota senate tax COM
mittee ready to begin it's consideration
of the income tax bill by the house OF
representatives, Senator F. j. Miller
chairman of the senate tax committee
has indicated, according to word re-
ceived here, that he will heed the adj
monition of businessmen here and in
sequences that will result if Minnesota
is made the highest income tax state
Answering queries put to him in st
Paul, Senator Miller called attention to
what he said are inequitable and unwise
provisions of the bill and said frankly
he thought their enactment would re-
suit in loss of jobs in Minnesota and
indirectly increased burdens on farmers
and other groups. With the income
tax occupying the center of the stage
at the capitol in st. Paul and both
firms and individual citizens here
vitality concerned in the drastic rate
increases proposed, Senator Miller's
analysis should be of real Interest.
1.-THE bill, as passed by the house
raises rates to maximum of 25 per
cent for individuals, which is 66 2-3 nc
higher than any other state individual
income tax" Senator Miller said. "The
maximum rate on corporations is 1870
which is 500 higher than any other
corporate income tax and 1000 higher
than the average. Eighteen states have
no corporate income tax whatever, and
twenty-four states have only flat rate
which averages 1880. The average
for all states having a corporate tax Is
only 4.28%.
incidentally, many of the states
competing with our Minnesota firms are
located in Illinois, Indiana, Michigan,
Ohio and other states where there is
no state income tax and where other
taxes are lower. Moreover, transpor-
tation costs are much lower for manu-
facturerS located in the Chicago or
Detroit area. Compared with a COM
petitor located in Chicago, Mime
sofa company making a product con-
structed largely of steel, has to pay
a penalty of about $32 ton on freight
in less than carload lots to bring it's
raw material up here and ship its pro-
duct back to Chicago. The Seegar Re-
frigerator Company could save $315, 900
a year on freight alone if it moved to
Dayton, Ohio.
"This should make it clear that we
cannot increase taxes on business firms
from 100 to 1000 as this bill provides
without throwing our rates too far out
of line with other states. Our business
firms are under enough of a handicap
now and it is clear that if we add to
that handicap many will not be able to
meet the competition from these more
favorable locations. A committee of
employees from one of the big COM
panies in Minneapolis came to me and
protested against this bill because of the
reduction in the number of jobs it will
cause. Many of our firms will be in
clined to make their expansions in
other states if this bill is passed with
the rates proposed. New firms will
hesitate to locate here. This will re-
duce jobs and in the end increase bur-
denS ON farmers and other groups"
A few facts on the bill disclose the
meaning of the several clauses. Accord
ing to figures provided by Rudolph
Lee prominent newspaper writer of
Twin Cities, the new income tax bill