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N. Y. Jan. 20,1942 Mr. Earriner S. Eccles. Federal Reserve Bank N. Y. City. Dear Sir; R e g a r d i n g t h e e n c l o s e d a r t i c l e p r i n t e d i n t h e 7/or3d T e l e g r a m l a s t n i g h t , i n r e f e r e n c e t o y o u r a d d r e s s t o t h e N. Y. Bankers Assc. I h a v e r e c e n t l y w r i t t e n t o S e c t . M o r g e n t h a u , a l s o t o my S e n a t o r s Mead a n d Wa g n e r p r o t e s t i n g a g a i n s t a n y ( w i t h o l d i n g T a x ) , r a t h e r a g e n e r a l s a l e s t a x w o u l d be p r e f e r a b l e , b e c a u s e i t w o u l d a f f e c t e v e r y c l a s s , where th6 w i t h o l d i n g t a x would o n l y a f f e c t t h o s e t h a t a r e on a c o m p a n y p a y r o l l , a n d t h e p e o p l e w o r k i n g f o r a s m a l l c o n c e r n t h a t o n l y e m p l o y e d o n e o r more p e o p l e , w o u l d e s c a p e . , t o o , I b e l i e v e i t i s u n c o n s t i t u t i o n a l , a n d u n d e macr a t i c , i t i s too much l i k e t h e m e t h o d s u s e d i n G e r ma n y b y t h e g e s t a p o . A l s o , i t w o u ld be a l l r i g h t t o t a k e f i f t e e n p e r c e n t fro m a man t h a t was e a r n i n g on e o r e tw o h u n d re d th o u s a n d a yean, b u t l o o k a t i t fr o m t h e p o i n t o f t h e s m a ll wage e a r n e r l i k e m y s e l f . bonus My s a l a r y i s 1 0 5 . 0 0 d o l l a r s from o u r company t o h e l p pa y per any mont h, i nc ome we d i d tax. I not get support any my e i g h t y y e a r o l d m o t h e r , a n d a s i s t e r who t a k e s c a r e o f h e r . o u t o f t h i s s m a l l p i t t a n c e I h a v e t o p a y 1 . 0 8 s o c i a l s e c u r i t y , * 90 g r o u p i n s u r a n c e , and a l s o a s a l a r y a l l o t m e n t o f 3 * 8 0 t b t h e T r a v e l e r s I n s . Co. f o r a p e r s o n a l i n s u r a n c e o f 1000,00. How c a n my f a m i l y e v e n e x i s t i f t h e G o v e r n m e n t t a k e s mo r e ? we w i l l a l l be on t h e c h a r i t y p a y r o l l s , a n d t h i s h a s n e v e r h a p p e n e d i n t h e h i s t o r y o f my f a m i l y . A g e n e r a l s a l e s t a x on e v e r y t h i n g b u t f o o d a n d m e d i c i n e w o u l d be f a i r e r , t h e n , t h o s e t h a t T^ere w o r k i n g on d e f e n s e j o b s , a n d m a k e in g d o u b l e t h e i r o r d i n a r y s a l a r y would have to pay e v e r y time t h e y b o u g h t a n y t h i n g , a n d t h e p e o p l e w o r k i n g on a s t a t i o n a r y s a l a r y w o u l d c u r t a il t h e ir buying, except necessary th in gs. T r u s t i n g y o u w i l l g i v e t h i s a, t h o u g h t , I R e ma i n P e s o e c t f u l l y Yours. E v e l y n G. S h a r k e y , 1 0 0 - 3 6 - 208 S t . B e l l a i r e , L. I. January <c3, 194^* Dear Miss bharKey: This will acknowledge your letter of January «c0, addressed to Chairman &ccles, in which you discuss recent tax proposals. Your comments are noted, and particularly your point that you would prefer a general sales tax to a withholding tax based upon salary. I might add, however, that it is quite likely that any withholding tax would provide for certain exemp tions for heads of families, in this event it is conceiv able that the head of a family might be exempted up to, say, $1,000. This,5 however, is only a personal observation »vhich 1 am passing on to you for whatever it is worth. I can also say personally that a sales tax with a food and drugs exemption would be fairer than a flat rate income tax Yvitnout exemptions so far as your situation is con cerned. Very truly yoursy Lawrence olayton, Assistcjit to the Chairman. Miss Evelyn G. Sharkey, 100-36 - >c08th Street, bellaire, Long Island, toew 'iork. LCrhow This article is protected by copyright and has been removed. The citation for the original is: New York World-Telegram, “Exemption Cuts, Withholding Tax Urged By Eccles: Reserve Chairman Addresses Bankers at Winter Meeting,” January 19, 1942.
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