“ To find sanction in existing tax legislation for deduction of petitioner's campaign expenditures would necessarily require allowance of deduction for campaign expenditures by all candidates, whether incumbents seeking reelection or new contenders. To draw a distinction between outlays for reelation and those for election-to allow the former and disallow the latter-is unsupportable in reason. It is even more unsupportable in public policy to derive from what Congress has thus far enacted a handicap against candidates challenging existing officeholders. ”

“ Without monetary rewards officeholding would necessarily be limited to one class only,-the independently wealthy. Proposals to accomplish such a purpose were deliberately rejected at the very beginning of the Nation's history. I deny the existence of a public policy which, while permitting Congress to tax the income of elected public officials, bars Congress from allowing a deduction for necessary campaign expenses. ”

“ Besides, Congress has not attempted to regulate expenditures of candidates for state office. I can hardly conceive that we should infer that it wanted to penalize through its tax laws, necessary campaign expenses, and thereby condemn a practice of compaigning that is as old as our country and which exists in every state of the Union. Unless our democratic philosophy is wrong, there can be no evil in a candidate spending a legally permissible and necessary sum to approach the electrorate and enable them to pass an informed judgment upon his qualifications. ”

“ The 1942 Act articulated the purpose of Congress to wipe out every vestige of a policy which denied tax deductions for legitimate expenses incurred in producing taxable income. Taxation on net, not on gross, income has always been the broad basic policy of our income tax laws. Net income may be defined as what remains out of gross income after subtracting the ordinary and necessary expenses incurred in efforts to obtain or to keep it. ”

“ The Tax Court also thought that 'under the ban of public conscience and * * * public policy is the contention that expenditures made to promote one's candidacy for election to public office represent expenses 'paid * * * for the production or collection of income." Public officials in this country, many of whom must campaign for election, are almost universally paid for their services. That we do pay out public servants is not at all inconsistent with the fact that public service in a large measure represents an honest expression of the social conscience. ”

“ What class of outlays may, in relation to the federal income tax, be deducted from gross income and in what amount are matters solely for Congress. Our only problem is to ascertain what provisions Congress has made regarding such expenditures as those for which the petitioner claims the right of deduction. The case is not embarrassed by any entanglement with corrupt practices legislation either state or federal. ”

“ State officials all over this nation have been subject to federal income taxes since 1939. When they run for office, they must necessarily spend some money to advertise their compaigns. We permit private individuals to deduct expenses incurred in advertising to get business. If this petitioner had owned a factory, the operations of which were suspended because of war contracts, and had advertised goods which he could not presently sell, the expenses of such advertising would have been deductible under Treasury rulings. ”

“ The relation between money and politics generally-and more particularly the cost of compaigns and contributions by prospective officeholders, especially judges-involves issues of far-reaching importance to a democracy and is beset with legislative difficulties that even judges can appreciate. But these difficulties can neither be met nor avoided by spurious interpretation of tax provisions dealing with allowable deductions. ”

“ The term 'trade or business' includes the performance of the functions of a public office.' This amendment, added by the Revenue Act of 1934, § 48, 48 Stat. 680, 696, was merely 'declaratory of existing law'. ”