Pusey Saves Loop-Hole In Revenue Law
Charity Deductions To Stay Unlimited
President Pusey was the leading lobbyist in killing a proposed tax reform that would have become part of the Revenue Act enacted this week, according to several government officials.
The reform called for repeal of a tax loophole known as the "unlimited charitable deduction," and would have been part of the Revenue Act of 1964. It would have limited the percentage of an individual taxpayer's income that may be deducted for contributing to charitable and educational programs.
Pusey argued that the reform would injure educational and charitable institutions which partially depend on large gifts from individual donors. Unlimited tax deduction is undoubtedly a factor in the presentation of such gifts.
According to the New York Times, Pusey wrote letters and telegrams to a number of Congressmen involved in the tax reform fight. The missives, "perhaps no more than a dozen," the Times continues, were probably enough to stymie the reform.
Only one-quarter of the loophole-closing reforms originally proposed by President Kennedy were authorized by Congress in the Revenue Act. Repeal of "unlimited charitable deduction" is one of the two principal reforms which involved $2.5 billion in additional revenue.
The second major reform, also not passed by Congress, was a plan to prohibit the taxpayer from making personal deductions that totaled less than five percent of his income. The reform was intended to exclude small deductions such as those on normal medical expenses.
The $822 million which the administration did succeed in getting from Congress includes, some restriction of what were considered, "serious abuses" of the unlimited charitable deduction.
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