Senator Sayre's Income Tax

SENATOR SAYRE'S INCOME TAX.

Ira T. Sayre, of Flushing, senator-elect from the Genesee-Livingston district is said to have prepared an income tax bill which he will present for the consideration of the next legislature. If Mr. Sayre's proposed law is correctly reported it is open to the same objections that are urged against the Atkinson law for the taxation of railroad property in that it proposes to devote the proceeds of the tax, first, to the payment of the state debt and when that has been discharged, to the payment of the interest upon the primary school fund. As the only state debt outstanding is the $500,000 which was blown into circulation in outfitting four regiments of state troops for the war with Spain, its payment is a minor matter. The primary school fund upon which the state pays interest to the several school districts in proportion to the number of children of school age residing therein is a comparatively fixed quantity, being a little over $900,000 per year. It will be readily seen that a law which will make the railroads stand their just share of taxation would soon create a surplus in the primary school interest fund for which there would be no use, without the addition of an income tax, and we take it for granted that, without the people have gone tax read they will not care to impose tax burdens simply for the purpose of taxing some one.

The difficulty of applying the proceeds of specific taxes to other than the purposes designated above is caused by section 1 of article XIV of the state constitution which provides that all specific taxes shall be applied in paying interest upon the primary school, university and other educational funds and the interest and principal of the state debt in the order named.

Until that section of the constitution is amended it will be impossible to satisfactorily readjust the burdens of taxation upon the basis of higher road taxation and an income tax, desirable as those reforms may be. While the purposes to which specific taxes may be applied under the constitution make but small demands upon the citizen compared with the tax raised for other state purposes they form relatively a much smaller proportion of the taxes for municipal, local school and county purposes.

In the city of Ann Arbor for instance, the rate for city purposes is $5.92, school $5.92, county 86 cents, and state $1.92, making a total of $14.92. If the entire state tax could be raised by railroad and income taxes (which the constitution forbids) it would lift less than one-seventh of our tax burden -- a smaller sum than we can save in any year by the practice of judicious economy and but little more than we did save in the past year without the average taxpayer knowing anything about it. But, under the constitution as it now stands, so small a portion of public burdens can be discharged by specific taxes that adequate relief from that source cannot be expected until that obstacle has been removed.

An income tax, to say nothing of increased railroad taxes, to be of appreciable benefit to the people of Ann Arbor must be collected by local authorities and expended for local purposes. An income tax based upon such principles and devoted to such purposes would be a welcome reform.