Occupational tax

“ In this record we can find no relevant correlation between the power of the municipalities to impose occupational license taxes and the compulsory disclosure and publication of the membership lists of the local branches of the National Association for the Advancement of Colored People. The occupational license tax ordinances of the municipalities are squarely aimed at reaching all, the commercial, professional, and business occupations within the communities. ”

“ The Government admits that not all 'fringe benefits' have been taxed as income, but it is enough to point out here that the withholding tax analogy is not perfect, for payments to laid-off employees from company-financed supplemental unemployment benefit plans are 'taxable income' to the employees although not 'wages' subject to withholding. ”

“ The purpose of the American Jobs Act is simple: to put more people back to work and more money in the pockets of those who are working. It will create more jobs for construction workers, more jobs for teachers, more jobs for veterans, and more jobs for long-term unemployed. (Applause.) It will provide -- it will provide a tax break for companies who hire new workers, and it will cut payroll taxes in half for every working American and every small business. ”

“ The individual laborer is left free to come and go at pleasure, and to make such contracts as he chooses, while those whose business it is to induce persons to enter into labor contracts and to change their location, though left free to contract, are subjected to taxation in respect of their business as other citizens are.
The amount of the tax imposed on occupations varies with the character of the occupation. Dealers in futures are compelled to pay $1,000 annually for each county in which the business is carried on ”

“ With respect to the first objection, that by raising the wages of labour and lowering profits it acts unequally, as it affects the income of the farmer, trader, and manufacturer, and leaves untaxed the income of the landlord, stockholder, and others enjoying fixed incomes,—it may be answered, that if the operation202 of the tax be unequal, it is for the legislature to make it equal, by taxing directly the rent of land, and the dividends from stock. ”

“ There seems, however, to be no sufficient reason why a tax on labour should be transferred to the employer, except in the case where the wages are really at a minimum below which the supply of efficient labour could not be kept up. Even in this case, as Prof. Walker shows, there would probably be a degradation of labour before the rise in wages was effected. Certainly no practical statesman at the present time would venture to propose a direct tax on wages, under the idea that it would be transferred to the employer. ”

“ So you must, but you must not draw it in a way to do gross and palpable injustice,—to exempt the comparatively affluent, and oppress the industrious poor. There is a vital distinction, which it would be well if the income tax recognised, between income, of any amount, derived from realised property and from professional exertions. By all means give the humble professional classes the benefit of this distinction. But to draw the line, not according to the quality of the income as derived from capital or labour, but from its absolute amount, is arbitrary, invidious, and unjust. ”

“ Of special importance in this case is the fact that eligibility for benefits, and the amount of such benefits, do not in any true sense depend on contribution to the program through the payment of taxes, but rather on the earnings record of the primary beneficiary.
The program is financed through a payroll tax levied on employees in covered employment, and on their employers. The tax rate, which is a fixed percentage of the first $4,800 of employee annual income, is set at a scale which will increase from year to year, presumably to keep pace with rising benefit costs. ”

“ Ordinary occupations are taxed in various ways, and, in most cases, legitimately taxed. But we fail to see how a state can tax a business occupation when it cannot tax the business itself. Of course, the exaction of a license tax as a condition of doing any particular business is a tax on the occupation ”

“ The ordinary or average price of provisions determines the quantity of money which must be paid to the workman, in order to enable him one year with another to purchase this liberal, moderate, or scanty subsistence. While the demand for labour, and the price of provisions, therefore remain the same, a direct tax upon the wages of labour can have no other effect than to raise them somewhat higher than the tax. ”

“ In this case it is the move to full employment under price stability. The present unemployed will find jobs. The higher productivity group will have a theoretically larger risk of unemployment, but in practice this risk will be modest as in the 1950s. Their real gain will come from the services that will be provided by the jobs of the present unemployed.
Policy makers will be hesitant about an overhaul of the tax system. Note, then, that the tax system defines our notion of a subsidy. A wrongly levied tax, in this case the tax void, can be compensated for by a wage cost subsidy. ”

“ Our most pressing need today and the future is more jobs--productive, permanent jobs created by a thriving economy. We must revise our tax system both to ease the burden of heavy taxation and to encourage the investment necessary for the creation of productive jobs for all Americans who want to work.
Earlier this month I proposed a permanent income tax reduction of $10 billion below current levels, including raising the personal exemption from $750 to $1,000. ”

“ All the effects which are produced on the profits of stock and the wages of labour, by a rise of rent and a rise of necessaries,302 in the natural progress of society, and increasing difficulty of production, will be produced by a rise of wages in consequence of taxation; and therefore the enjoyments of the labourer, as well as those of his employers, will be curtailed by the tax ”

“ The effect of such a course on industry and unemployment is disastrous. If initiative and enterprise, which, in this country, form the life-blood of industry, are to escape extinction, then taxation on industry must speedily be reduced. The directions in which business men are pressing for alleviation from the insupportable oppression of taxation are in the reduction of the rate of income-tax, exemption from super-tax of reserves invested in the business, and abolition of the corporation profits tax. ”

“ Let no one be deceived into feeling that this is a simple and easy way of saddling government expenses upon the rich.
Special taxes.—A multitude of minor devices are worthy of brief consideration. An occupation tax on business men is easily levied, but bears unequally upon the original payers, and in the end falls most heavily upon the poorest. A house tax, measured by the number of rooms, or the number of windows, or the number of fireplaces, has been supposed adjustable to actual income of the possessors. ”

“ At any rate, in all cases in which the rate of wages is above the "necessary" minimum, a tax on wages must fall on the labourer. A differential tax on some particular species of employment would, unless it partook of the nature of a monopoly, tend to fall on the consumer of the article produced or the person who enjoys the service rendered. In every case, speaking generally, the incidence of the tax will depend on the conditions of the demand and supply of the labour in question, and no further analysis can be given without entering into the general principles governing wages. ”

“ Core cities were originally the location of most commerce and industry. Many of those facilities furnished employment for the unskilled and semiskilled. These employees lived relatively near their work, so sections of cities always have housed the majority of people of low and moderate income, generally in old and deteriorating housing. Despite the municipally confined tax structure, commercial and industrial ratables generally used to supply enough revenue to provide and maintain municipal services equal or superior to those furnished in most suburban and rural areas. ”

“ It follows that on the record before us the exaction of the license fee cannot be sustained either as an inspection fee or as an excise for the use of the streets of the city. It remains to consider whether it can be sustained as an occupation tax. A state may, by appropriate legislation, require payment of an occupation tax from one engaged in both intrastate and interstate commerce. ”

“ And we have to get wages rising again in this country for working people. We've got to make sure that our lowest paid workers keep up. That's why in 1993 I cut taxes for working people on modest incomes through the earned-income tax credit, giving tax benefits to 15 million working Americans, a downpayment on a strong commitment that no one who works full time and has children in the home should live in poverty. And that is why we must make sure the minimum wage is a living wage. ”

“ The extent to which salaries in business or professions whose standards of compensation are otherwise fixed by competitive conditions may be affected by the immunity of state employees from income tax is to a high degree conjectural. ”

“ Title VIII, as we have said, lays two different types of tax, an 'income tax on employees,' and 'an excise tax on employers.' The income tax on employees is measured by wages paid during the calendar year. Section 801 (42 U.S.C.A. § 1001) . The excise tax on the employer is to be paid 'with respect to having individuals in his employ,' and, like the tax on employees, is measured by wages. ”

“ It is the natural result of the workers seeing large profits made out of their industry, if they should have no benefit, by increase of wages, by sharing in such profits or otherwise. It makes but little difference to the workers that those profits go to ratepayers, instead of to shareholders, more especially as they usually inhabit houses let on weekly inclusive rentals, and are exempt from income-tax, so that they do not directly pay either rates or taxes. ”

“ Secondly, however, it may happen that the dearness of the taxed food does not lower the habitual standard of the laborer's requirements, but that wages, on the contrary, through an action on population, rise, in shorter or longer periods, so as to compensate the laborers for their portion of the tax, the compensation being of course at the expense of profits. ”

“ In 1957 the Commissioner of Internal Revenue ruled that strike benefits paid by unions to strikers on the basis of need, without regard to union membership, were to be regarded as part of the recipient's gross income for income tax purposes. ”

“ Is it conceivable that, at the very moment when we are complaining of not being able to find employment for the poor; when the press teems with nostrums for this purpose; and every one admits the necessity of finding such employment, that there should be continued a tax upon labour to the amount of no less than six millions per annum! ”

“ Inasmuch indeed as wages, and through wages, the rate of profits are affected, landlords, instead of contributing their full share to such a tax, are the class peculiarly exempted. It is the profits of stock, from which that portion of the tax is derived which falls on those labourers, who from the insufficiency of their funds, are incapable of paying taxes; this portion is exclusively borne by all those whose income is derived from the employment of stock, and therefore it in no degree affects landlords. ”

“ Government employees, lawyers, doctors, teachers, pharmacists, veterinarians, subway conductors, industrial workers and a multitude of others have been denied an opportunity to work at their trade or profession for these reasons. Here a tax is levied unless the taxpayer makes an oath that he does not and will not in the future advocate certain things; in Ohio those without jobs have been denied unemployment insurance unless they are willing to swear that they do not hold specific views ”

“ The issue in these cases is whether the New York Unemployment Insurance tax may be collected from employers of certain employees engaged in maritime employment on the wages of those employees. The New York Act, Labor Law, Consol.Laws, c. 31, § 500 et seq., levies a payroll tax on all employers of four or more persons, with exceptions not here material, and the sum thus collected is paid into a general fund for the benefit of all unemployed persons covered. ”

“ Isn't it great that we are going to lower the payroll tax on workers? We are going to go from 6.2 percent, which workers now pay, down to 4.2 percent. People are going to have more money in their pocket, which certainly is a good thing. It is going to cost $120 billion in Social Security payroll taxes. ”

“ I believe the weight of the evidence is that a modest increase does not cost jobs and may even lure people back into the job market. But the most important thing is, you can't make a living on $4.25 an hour, especially if you have children, even with the working families tax cut we passed last year. ”

“ In a society which [p173] came to depend more and more on expensive individual motor vehicle transportation for all purposes, low income employees very frequently could not afford to reach outlying places of suitable employment and they certainly could not afford the permissible housing near such locations. These people have great difficulty in obtaining work and have been forced to remain in housing which is overcrowded, and has become more and more substandard and less and less tax productive. ”

“ In short, it cannot be deemed arbitrary or unreasonable for the state, instead of imposing upon the particular employer entire responsibility for losses occurring in his own plant or work, to impose the burden upon the industry through a system of occupation taxes limited to the actual losses occurring in the respective classes of occupation. ”