148

STATEMENT ON AGREEMENTS, BALTIMORE TUGBOAT

STRIKE

April 13, 1967

The difficult task of preparing the contract language has finally been
completed by the subcommittees of labor and management in the
Baltimore tugboat strike.

The proposed contracts will be submitted to the union membership
at a meeting to be held at 5: 30 p. m. tomorrow (Friday).

This has been one of the longest and most frustrating labor disputes
in my memory. As Governor of Maryland, I strongly urge the union
membership to act promptly to ratify these agreements so that the
economic health of the Port of Baltimore can be restored as quickly
as possible.

STATEMENT ON SIGNING HOUSE BILL 378
(THE TAX REFORM BILL)

April 14, 1967

Ladies and Gentlemen, the Act that I am about to sign, House Bill
378, is the most talked about but least understood measure enacted by
the 1967 Maryland General Assembly. This is the Tax Reform Bill,
and I am confident that in time it will be recognized by the public—
as it was by the Legislature — for the enlightened, progressive legisla-
tion that it is.

With House Bill 378 we begin a much needed, long overdue re-
structuring of the revenue base of government. The graduated income
tax of 2 to 5 per cent, which replaces the present flat 3 per cent State
rate, recognizes a person's ability to pay in assessing the cost of govern-
mental services. This principle was adopted by the Federal government
many years ago for its major tax source, and its equity has long been
recognized.

Retired persons on fixed and limited incomes, and those generally in
the lower income brackets who are caught in the squeeze of inflation,
will benefit from the graduated tax. So will those who derive a sub-
stantial portion of their income from investments since the present flat
5 per cent tax on investment income will be replaced by a graduated
rate of 2 to 5 per cent.