Tax reform promises much ...but for whom?

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The initial hoopla in the media over the proposed tax reform measures before Congress heralded the coming of a new era of "fair and simplified" income-tax rules. But slowly the truth is emerging: The rich will pay less and the great majority of working people will pay more. Surprise!

For the past year, President Reagan has led the pack of politicians in both parties in a fake campaign against the scandalously unfair tax system. They piously mislabel their tax "reform" a "second American revolution."

But what the capitalist politicians have in mind is not reducing taxes. Their "reform" is a continuation of the nearly half-century-long policy of shifting the tax burden from the rich to the poor.

In 1940 President Franklin D. Roosevelt instituted the withholding tax, which was falsely portrayed as "progressive," that is, according to the principle of the higher the income the higher the tax rate.

In fact, this so-called progressive tax rips off an increasing proportion of wages, but not profits. This happens automatically when wages are forced into higher tax-rate brackets as inflation erodes the buying power of the dollar.

The 1940 withholding tax law was palmed off by Roosevelt as in accord with the progressive rule that provides for the rich being taxed at a higher rate than the poor. But profits were systematically protected from this increased rate of taxation by a maze of specially designed loopholes-for capitalists only.

In the years that followed, workers found to their dismay that Roosevelt's "progressive" tax really meant that inflated dollars led to higher tax rates as well as lower purchasing power.

Reagan has demagogically decried the injustice of this built-in mechanism for increasing the proportion of wages deducted from weekly paychecks. He has been campaigning for a so-called flat-tax rate under which a percentage ar vortir ilasmeniy taxes as a same their income in taxes as a multi-millionaire.

Many workers, wincing each time inflation forces them into a higher tax bracket, have been suckered into supporting the bipartisan drive toward a more openly regressive flat-tax system.

The shysters in the two houses of Congress are presently engaged in a sham battle over which of the two bills gives more tax relief to "the people." But it is absurd to believe that in these days of runaway budget deficits the ruling class will even-handedly reduce the taxes of rich and poor.

Moreover, to the extent that total taxes are indeed less than government expenditures, the "reform's" inflationary effect is the cruelest of any flat-tax. It eats away at paychecks, thus cutting into the amount of food an shelter the lowest paid workers can buy.

Sugar Coating The tax bill that has received the most attention till now is the Senate version, which was adopted 97-3 on June 24.

New York Times writer David E. Rosenbaum first helps to hype the bill with this now-familiar sugarcoated description: "Tax rates would be dramatically lowered under the bill, hundreds of loopholes would be plugged, 6 million poor people would be removed from the tax rolls altogether and dozens of profitable on the vine by "Where were you when we needed you?". That's a question the 6000 striking flight attendants at Trans World Airlines (TWA) certainly have a right to pose to the AFL-CIO especially the machinists' and pilots' unions—in the wake of their strike's defeat.

The Independent Federation of Flight Attendants (IFFA), which struck TWA on March 7 over the company's demand for a 44-percent reduction in wages, benefits, and work-rule changes, stuck it out for more than two months before its leaders abandoned the strike in late May.

IPFA leaders decided to end the strike, without agreement on the disputed issues, in an effort to stem the tide of scabs taking jobs from strikers. Still, despite the fact that the union agreed to return to work, the YOU'RE NOTHING ANDA SCOUN KEL/ TIE ORLANDO SENTIN wanil nosi wiertls wiery *ir:

cons illusion. But both versions make the same basic changes in favor of the rich.

Both bills, for example, would make unemployment insurance fully taxable. But the House version would retain sales-tax deductions while the Senate bill would eliminate this in most cases.

The Senate bill would have a devastating impact; for example, on actors. Officers of Actors Equity, the Screen Actors Guild, and the American Federation of Television and Radio Arists charge that this tax bill would severely harm members of their unions. The changes that actors are protesting, however, go beyond this particular group of working people.

The new income tax rules would eliminate many categories of itemized deductions workers must pay to get or keep jobs. These include union dues, fees for classes necessary to a given trade or profession, trade publications and equipment, and even deductions for outof-town living expenses.

The new rules would also eliminate income-averaging, which is an important safeguard for workers who may get an occasional good year sandwiched between several years of half-time pay and therefore have a backlog of debts.

The Senate bill, moreover, can't resist putting a little more icing on the capitalist cake at workers' expense; it takes away deductions for interest on consumer loans-like for cars and refrigerators-but continues to allow them for business loans!

Of course many changes will take place before the projected tax "reform" becomes law. More sugar-coating and some back-tracking is no doubt in the works.

According to the shell game played between the two capitalist parties, a "compromise" between the Re publican-controlled Senate and the Democrat-controller! House will eventually be "hammered out."

One thing is for certain, the final result will means more bucks for the rich and lower living standards for the rest of us.

displays of solidarity with the strikers by local unions, rank-and-file unionists, and others also on strike, such as the Hormel workers.

Despite the new sense of militancy among many rank-and-file unionists, the top union officaldom remains mired in the mud of complacency, incapable of formulating any strategy to fight the concessionary trend.

The IFFA, which offered TWA a 15percent cut, has unfortunately learned the hard way that bending over backwards to convince management of its "reasonable" stance is a futile gesture. Employers are motivated not by a well-argued point, let alone a sense of justice, but by the acquisition of profit. And the more they get, the more they want.

Solidarity must be made concrete. Airline workers have been hard hit by concessions, two-tier contracts, and worsened work rules. It's time they stand together, and strike together, to fight for better wages and benefits, rather than allow every union to be beaten down one at a time.

ACTION JULY 1986