Evening star., 1938-12-16
Tax Advisers
Seek Final
Formula
Meet Again Today;
Fair Toxotion Group
Presses Income Levy

Members of the Commissioners
Tax Advisory Committee were sched-
uled to meet again today in a re-
newed effort to draft final" recon-
mendations on proposed revision Of
the Districts tax structure. Pre-
vious efforts for a unanimous de-
cision have failed.
A new statement of support for
a graduate personal net income tax,
and opposing the suggested COM
bination of sales tax with a mon
salary, non-wage" income levy, was
filed with the committee yesterday
by officials Of the Citizens Commit
tee on Fair Taxation.
This brief was an expansion Of
arguments made by spokesmen for
the group at the recent public hear
ings on the suggested combination
plan held at the Capitol by the
Advisory Committee. The group Of
fered the following flve-point plan:
l. Unconditional repeal of the
business privilege tx, on the ground
that this levy is,a hidden sales tax"
and was condemned at congressional
hearings last session.
Would Tax Corporate Income.
2. Substitution of a corporate net
income tax at per cent, with yield
estimated at $2,500,00O to $4,000, 900.
The group contended such a tax
would be paid only where there are
profits and the tax could not be
shifted to consumers.
3. Abandonment of the proposed
"non-salary, none-wage" personal
net lncome-retail sales tax, insist
ing that such levy would be "in-
equitable in its effect, capricious in
its incidence, unpredictable in its
yield and extremely difficult of ad-
ministration."
4. Repeal of the intangible per-
sonal property tax, conditional only
on the substitution of an ADEQUATE
progressive personal net income tax.
5. Enactment of a progressive per-
sonal income levy, using Federal per-
sonal exemptions and credits for
dependents. The group estimated
such a levy could be designed to
yield from 100000 to $500 900
under a moderate" schedule of
rates.
The groups brief attacked various
arguments advanced by the Com
missioners' Advisory Committee in
support of its suggested combina-
ton OF sales tax with a limited
income levy, the latter being de-
signed to dodge the question as to
application of a fortnight income
tax to Federal workers.
Claims Tax Legal.
THE objection of doubt of con-.
stitutionality' is brought forward
regularly in an effort to scare away
proponents of the. income tax" the
group asserted. There is no doubt
whatsoever as to the legality or con-
stitutionality Of the Congress power
to tax the salaries of Federal en-
ployes."
The group protested that a sales
tax violates the principle of ability
to pay" and would increase the
burden of the poor. A companion
statement, submitted by Genevieve
B. Wimsatt, secretary of the group,
compared the estimated effects of a
sales tax as against an income tax.
On this point the group said:
Notice that So in sales taxes, but
no income tax, would be paid by the
single person who earned barely
enough to live on-$100O. However,
the single man who earned 10 times
as much, or $4,000, would be in
the reverse position. He would pay
$42 sales tax or 500 income tax.
All persons who earn less than SO 900
year would pay less income tax
than sales tax.
"A family of five would pay at
least twice as much sales tax as in.
come tax If its income was less than
$1,000"