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Dec. 29, 1916. 
NEW INCOME TAX 
SomMEerHING Asout THE NEw Law 
Wuicu Gors INto OPERATION 
JANUARY I. 
The Massachusetts Income Tax 
goes into operation January I, I9I7. 
Below we give a summary of the new 
law furnished the Brerze by Joseph 
E. Perry, Income Tax Attorney of 
the Tax Commissioner’s office. 
The new law leaves unchanged 
such parts of our present tax system 
as the local. assessment of real estate 
and tangible personal property; the 
taxation of corporations, inheritances, 
polls, and the various license and 
similar taxes. In the future, as in 
the past, shares of stock in Massa- 
chusetts corporations, deposits in 
Massachusetts savings banks, mort- 
gages or real estate taxed in Massa- 
chusetts will be exempt from taxation 
as will be also the income derived 
from such property. 
The new law taxes the income from 
certain classes of property, the net 
income from earnings, and the net 
profits from the purchase and sale of 
securities. It exempts from further 
taxation the property from which 
such taxed income is derived. 
It differs from the Federal Income 
Tax in that it taxes only income from 
certain sources and not from all 
sources, and it has only flat rates in- 
stead of progressive rates which in- 
crease with the size of the taxed in- 
come. It differs also in the details 
of its deductions and its administra- 
tion but in adopting the calendar 
year as the taxable period and in the 
forms of returns required and in all 
other ways, it follows the Federal 
system so far as is possible so as to 
cause the minimum of additional in- 
convenience to the taxpayer. 
The new law was designed to cor- 
rect certain evils which have devel- 
oped in the present system. The rate 
of taxation is uniform throughout the 
state, thereby removing the chief in- 
centive, as far as evasion of taxes is 
concerned, for the wealthlv people to 
colonize in a few towns with low tax 
rates. The new law is to be admin- 
istered by the state in a centralized 
manner insuring uniformity of assess- 
ment and collection, and removing the 
possibility of understandings between 
local assessors and wealthy residents 
which have usually resulted in gross 
undervaluations and inequality of 
justice. The new rates compare 
favorably with those of surround- 
ing states and should check the 
alarming emigration of capital from 
the state. The new law substitutes 
just and reasonable taxation in place 
of previous confiscation. It puts a 
premium on honesty instead of deceit. 
NORTH SHORE BREEZE 
on 
ARIAK 
O OUR FRIENDS 
in Manchester and vicinity we extend our 
thanks for the very generous patronage accorded us during the 
past year and wish them a Very Happy and Prosperous New Year. 
“SERSSC 
F. Ss. ens ee Jeweler 
164 Main St. - 
Gloucester 
It provides for compulsory returns 
and backs up that provision by severe 
penalties and by obtaining informa- 
tion at the source. It abandons April 
first as the sole test of taxable citizen- 
ship and taxability. Instead, the tax 
is measured by the income received 
during the entire calendar year next 
preceding, and makes taxable every 
person who is an inhabitant of Mass1- 
chusetts at any time during the first 
half of the year. 
Perhaps most general interest 1s 
attached to the tax of one and one- 
half percent on the excess above two 
thousand dollars of the net income 
derived from _ professions, employ- 
ments, trade and business. The law 
provides in detail the method by 
which such net income shall be com- 
puted and requires a return to be 
made by each person whose gross in- 
come exceeds two thousand dollars 
even though by exemptions and de- 
ductions the net may be reduced be- 
low the taxable limit. For those 
with dependents the exemption may 
be as high as three thousand dollars. 
The same rate is applied to income 
from annuities. 
A tax of three percent is imposed 
on the profits from the sale of securi- 
ties with directions for determining 
the amount of the profit. 
A tax of six percent is levied on 
the income from bonds, shares in 
corporations and partnerships, money: 
at interest and other debts due the 
taxpayer with exceptions which may 
be stated broadly by saying that no 
such income is taxable which is de- 
rived from sources which heretofore 
have been non-taxable, except in the 
case of partnerships having trans- 
ferable shares. Under some condi- 
tions, a small exemption may be ob- 
tained- as to income from annuities 
and as to income taxed at the six per- 
cent rate. 
Partnerships, minors, estates of 
deceased persons and in general all 
persons or organizations, except cor- 
porations, receiving taxable income 
are. taxable, and all are entitled to the 
provisions relating to abatements and 
appeals. 
Chief interest centers in the re- 
quirements that returns are compul- 
sory and must be made within the 
first two months of the year—i. e. on 
before March first. In case of 
persons becoming inhabitants after 
March first, or by reason of absence, 
etc., being unable to make the return, 
other provisions apply. 
Returns may be made at the State 
House or to the Income Tax Assessor 
or Deputies in the district where the 
inhabitant lives. The division into 
districts, the names and office ad- 
dresses of the Assessors and Deputies 
will be announced later. Blanks for 
the returns will be available on appli- 
cation to the Tax Commissioner or 
any of his Deputies, or from bank- 
ing institutions throughout the State. 
Returns as to real estate and tan- 
gible personal property should be 
made to the assessors of each city or 
town as heretofore, and if a taxpayer 
fails to make such return, he will be 
obliged, in addition to his state tax, 
to pay locally not less than he paid 
last year. 
Tax bills will be sent out and the 
tax payable October 15, 1917. The 
proceeds will be distributed back to 
the various cities and towns and the 
latter are guaranteed to suffer no loss 
of revenue. 
The new tax is expected to reach 
nearly five billions of property which 
kas heretofore escaped taxation, to 
produce more revenue, and to be ad- 
ministered at a cost of less than one 
percent of the revenue produced. 
Little Roy was playing with his 
mother’s opera-glasses, and, happen- 
ing to look at her through the big end, 
he exclaimed, ‘“(O mother, you are so 
far away you look like a distant rela- 
tive.”"—Boston Transcript. 
He who cannot learn has ceased to 
live. 
Much of this love at first sight 
turns out to be of the squint-eyed 
variety. 
He darkens his own way who 
mnakes light of the troubles of others. 
