The Wilmington morning star., 1944-03-02
BY S. BURTON HEATH
NEA Staff CORRESPONDENTS

|
WASHINGTON, Mar. 1.-The
exasperating troubles that income
taxpayers have experienced fo~
years, and which now are Great.
ing a crisis, arise from two prin.
cipal sources.
First, from the fact that there
are three different tax bases, O,
each of which tax is levied bv
a formula that is different in eve.
ry case.
This, it appears, Congress and
the Treasury intend to try to cor.
rect this yearly abolishing the
Victory Tax and making the bases
identical for Normal and Surtax
Second, from the multiplicity Of
Illogical, incomprehensible provi.
sions for deductions and credits
which have become such tumble
that it is difficult to find two ex.
perts in the Bureau of Internal
Revenue who will agree about any
persons allowable deductions.
I propose that we eliminate both
Of these problems by adopting a
brand new tax base that will con.
sist of gross salary minus an a.
lowance for the number of per.
sons who must live on that salary.
This means eliminating, as de-
auctions, the expenses connected
with earning ones salary or
wages. In turn, that would put
upon employers the duty to REIN
burse employees for such ex-
penses, which could be done, as it
usually is done now, through ex-
pense accounts; or it could be
done by flat allowances which
would not be considered as part
of the salary and would not be
subject to income tax.
It means eliminating also the
present deductions in lines II to
is of Form 100-contributio1s. in
terest. taxes. losses, medical ex-
penses, etc.
| This is where the activities OF
pressure groups are feared.
It is not feasible, in these arti-
cles, to discuss every phase Of
this proposal. 1t can be pointed
out, however, that the net effect
would be identical with what has
been done. in roundabout way,
in the optional form 104oA, with
out injuring many persons.
Form 1O4OA assumes that those
who use it will have average"
deductions, and allows for them,
Actually, it levels off deductions.
The effect can be illustrated this
way:
!; Suppose AS income is $4,000.
and it is desired to get $270 in
taxes from him. We can credit
him with 10 per cent deductions,
reduce his taxable income to
S27O0, apply a tax rate of 10 per
cent, and get 1910. Or we can
forget the deductions, consider his
, taxable income as the full $4,000.
and set the rate at 9 per cent,
which will yield the same $27O in
taxes.
The optional form uses the first
method. I propose that we adopt
the second, and extend it to cover
all individual income taxpayers
rather than merely those with in
comes of $4,000 or less who choose
to use the optional form of return.
Some individuals would lose by
this proposal. For example, man
, who is buying his home now is
permitted to deduct real estate
taxes and the interest on his mort
gage. This is helpful to him. But
the renter, has no corresponding
deductions.
BY what logic should the buyer
be permitted to charge off PEI
haps half of the rental on his
living accommodations on his IN
come tax, whereas the renter can
charge off nothing?
Today, some taxes are deduc-
tible. Others. which are Just as
, legitimate out-of pocket expenses.
!. are not deductible. Only skilled
!, ! lawyers can tell which. In the de-
termination there is neither logic
nor justice, but only the techni-
T cality of the language of the law
levying the taxes.
Up to the last year there was
no allowance for medical ex-
penses. Now there is one. 1t looks
encouraging. Yet relatively, few
persons get any good out of it.
1t adds greatly to the complica-
ton Of the tax return. And it is
Illogical and unjrst
For instance. BIS wife has an
operation. If B can afford to keep
her in the hospital during con-
valescence, he can deduct the ex-
pease from his taxable income.
But if she has to come home to
recuperate, and maid is hired
to do the work and keep an eye
on the invalid, nothing can be de-
Quoted for the maid. This problem
has scores of ramificatiors that
work discrimination and hardship
The gesture TO few is not worth
the trouble it causes.
So, I propose that all such de-
auctions be abolished, and that the
tax base for the future shall be
total income minus fixed credit
for each member of the family or
other dependent
i
SUB BUILDER DIES
MADRID, March 1.-tR-Hans
TeChel ~ hl1i!der of Gernanv s