The daily monitor leader. [volume] (Mount Clemens, Mich.) 1942-19??, 1944-07-03
Rowing Reporters

Means Committee says. Has II?
Well it's a matter of semantics.
Actually, the Victory Tax,
3 per cent, has been given q
new name. Now il is called the
Normal Tax. 1t has been made
TO apply to all income over $500
instead of, as formerly, to all
income over S624.
DEPENDENCY HUMANIZED
The old normal and surtaxes
have been merged into the new
Surtax. This is in line with the
urging of all objective critics of
the old income tax mess. In
computing the tax base, the per-
sonal exemption and credit for
dependents has ben leveled off
at $500 per person, in place Of
the old complicated system a
reform advocated by this writer
IN a series of articles last spring.
The test of dependency has
been humanized and simplified.
The test now is actual depend
ency, within reason. But now q
family that supports any person
not related by blood cannot
claim dependency for income
tax purposes. II, for example.
you are supporting the mother.
less child of service man until
its father comes home from the
war, you could deduct for a de-
pendent under the old law but
you can't under the new. Mel
Their, as the law appears to read.
can you deduct that expenditure
as contribution to charity.
COLLECTORS COMPUTE TAX
The withholding tax has been
graduated SO that it will come
close to covering the entire tax
for anybody whose income Il
not more than 500. do not have
to file tax estimates.
Persons whose income il un.
der $4,000, gross, of which not
more than $100 comes from
sources not subject to the with
holding tax, can answer q few
questions and let the Collectors
office compute their tax.
In order to do this they must
accept standardized allowance,
in lieu of all legal credits, Of
10 per cent of their adjusted
gross income" which, by the
way, is a new term introduced
in the interest of simplication.
Inevitably. persons whose
credits are less than the arbi-
:rary 10 per cent will accept
that 10 per cent. and pay less
tax than is due to the govern.
ment; persons with greater cred
its will compute their tax on !
blank and take full ADVANTAGES
Of the permissible deductions,
the government will lose m
amount of income that probably
nobody can estimate accurately
in advance.
The limit to charitable contri-
button has been raised to IS per
cent of gross income instead Of
Is per cent of net income but
only the wealthy ever ran ND
against the ceiling under the Old
law. The floor below medical
expense deductions has been
raised from five per cent Of net
income, under the old law, 70
five per cent gross income UNI
der the new, SO that even fewer
taxpayers will benefit from this
dispensation.
WAVES FILING
Without mentioning other
minor changes. which have been
described in news stories NJ
ready, this should b enough
to illustrate one major aspect o&
this "simplification."
The law simplifies the tax
only slightly. What il does, In
fact, is waive the filing require
ment for some $4,000, 900 Per.
sons. Their tax obligations are
almost as complicated as ever.
But Congress says to them:
IF you're willing to gamble
on a 10 per cent allowance for
deductions, the Treasury win
do your work for you every
March Is. II you insist upon
your rights, you can 60 ahead
and fill out your own tax rs-l
turn, and see how you like IT,"
By the time the issue arises
the elections will be over.