Evening star., 1942-09-23
Committee
Tax Exemption Bill
Goes 10 Senate Soon
Measure Sets General
Principles and Names
Some Groups Specifically

The revised McCarran bill, re-
storing tax exemption to most of
the charitable. religious, educational
and scientific institutions declared
taxable by the Commissioners in the
last 18 months, will be ready for
presentation to the Senate by the
end Of the week.
The District Committee approved
the measure yesterday, but Senator
McCarran, Democrat, of Nevada
said it will take several days to
draft the report, in which he expects
to set forth in detail the intent of
Congress as to the scope OF the new
definitions.
After drafting general language
to describe the various types of
institutions entitled to exemption.
the committee wrote in by name
eight national organizations that
have their headquarters here and
which the committee believed should
retain exemption. These are:
The National Geographic Society,
American Pharmaceutical Society,
the National Academy of Sciences,
the Brookings Institution, the Amer
ican Forestry Association, the Car
negie Institution, the American As
sociation for Teaching Speech to the
Deaf and the American Chemical
Society.
New Rule on Land Holdings.
The committee adopted a new rule
to govern the amount of tax-exempt
abutting land an exempt institution
should be allowed to hold for future
growth. The new definition states
that all such land owned on July l,
1912, shall remain exempt, but if at
any future time it is sold for other
purposes back taxes would have to
be paid on it up to a limit of 50
per cent of the net profit from the
sale. This was designed to dis
courage the holding of excess land
except for anticipated future needs
OF the institution.
The general definitions exempt
art galleries, libraries, charitable
institutions, hospitals, schools, COL
leges, cemeteries, churches, parson-
ages and cemeteries. For each of
these categories the basic rule is
that they are not organized or
operated for private gain. A church
building Is defined as one primarily
used by its congregation.
The committee adopted separate
definition which, it is believed, will
exempt the various study houses OF
religious orders in the vicinity of
Catholic University and the Fran
ciscan Monastery. 1t reads as fol-
lows:
Buildings belonging to religious
corporations or societies primarily
and regularly used for religious wor-
ship, study, training and missionary
activities"
Repeals No Special Exemptions.
Congress from time to time in the
past has granted tax exemption to
certain institutions by name. The
new bill does not repeal these laws,
but directs the Commissioners. to re-
view those cases and make recon-
mendations to Congress by next
July.
The bill retains a proposal of the
Commissioners that all exempt in
stitutions file statement annually
on March l, setting forth the use to
which exempt property was put
during the year, to aid the District
government in keeping track of
changes in such use.
The general effect of the bill is
to take out OF the old exemption
laws restrictive definitions, which
gave rise to the recent series of
rulings withdrawing tax exemption.
For example, the old law governing
charitable homes said they must
be purely" charitable, and this was
held to bar from exemption an in
stitution that cared for members of
a particular sect.