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1320003

Ronald Reagan

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" If the people want ʻwithholdingʼ they can vote for it by doing it voluntarily under our plan."

Ronald Wilson Reagan, 1911-2004.  40th President of the United States.  Autographed Note, unsigned, one page, 4 x 6, on plain stationery, no place [California], no date [ca. 1970].

These are Reaganʼs handwritten notes for a speech—or perhaps for more than one—in support of his plan for voluntary state income tax withholding during his first term as governor of California. 

Reagan's main legislative priority in 1969-1970 was tax relief for homeowners burdened by sharp increases in local real estate taxes.  His proposed omnibus tax bill included a provision for voluntary state income tax withholding.  At the time, California did not require employers to withhold income taxes from salaries and wages.  Reagan supported voluntary withholding but refused to support legislation mandating it.  During his 1970 reelection campaign, he campaigned on the promise that his feet were set "in concrete" against adopting compulsory withholding.  He thus writes in these notes:  "Word ʻwithholding' is not the issue  /  The issue is whether it is ʻvoluntaryʼ or compulsory.  /  If the people want ʻwithholdingʼ they can vote for it by doing it voluntarily under our plan.  /  There are two advantages to withholding one the convenience to the tax payer the other the increased revenue to the state."

The federal government and most states require employers to withhold income taxes as a defense against tax evasion and as a way to insure cash flow to the government coffers.  Reagan's proposal for voluntary withholding, however, failed to gain even the support of his fellow Republicans who controlled the California General Assembly.  The measure would have been both burdensome and expensive for employers, who would have had to maintain separate accounting for those employees who chose voluntary tax withholding and for those who did not.  Since it was impossible to know who would choose to withhold, the state could not accurately forecast what its cash flow would be.  Despite broad support for property tax relief, the voluntary withholding proposal went nowhere. 

Ironically, a year later, Reagan acquiesced and signed into law a provision requiring income tax withholding in California.  He joked, "I can hear the concrete cracking around my feet."

These notes have never been on the autograph market before.  They come from the estate of former California state Senator John Oliver Stull, a fellow Republican whom Reagan knew well.  Stull (1920-2011) represented California's 80th Assembly District, covering North San Diego County, from 1967 to 1972.  During his tenure he crafted California's famous Stull Act, part of the education code, which made the state's public school teachers accountable for the progress of their students.  Stull then won a special election to the California Senate in 1973 and represented the 38th Senate District until 1978. 

Reagan has boldly penned the notes in black.  The piece has one horizontal fold and shows the handling that is expected from the use of the notes for a speech.  Overall it is in fine condition.  It is accompanied by an unsealed envelope marked in another hand "Note written by / Governor Reagan / on ʻWithholding.ʼ"

Unframed.    Please ask us about custom framing this piece.

 

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