Dwight D. Eisenhower photo

Veto of Bill Relating to Unemployment Tax Credits of Successor Employers.

June 03, 1960

To the House of Representatives:

I return herewith, without my approval, H.R. 6482, entitled "An Act Relating to the credits against the unemployment tax in the case of certain successor employers."

To help finance the Federal-State unemployment compensation system, the Federal Government imposes on covered employers an annual tax of 3 percent on the first $3,000 of each employee's wages.

A special provision of law permits the wages paid each employee by a predecessor employer to be taken into account for purposes of the $3,000 annual limitation on taxable wages by an employer who succeeds to the business. This provision is intended to insure that taxes paid with respect to the wages of any one employee are not increased for any year as a result of the business changing hands during the year. This desirable purpose is thwarted under present law, however, whenever a predecessor does not qualify as an "employer" within the meaning of that word as it is defined in the Federal law.

H.R. 6482 would correct this situation, but it would do so, not just prospectively, but also retroactively to the beginning of 1951.

Strict avoidance of retroactive tax legislation, except in extraordinary and compelling circumstances not here in evidence, is essential to orderly tax administration, the Government's revenues and the fair treatment of taxpayers.

Although constrained, therefore, to disapprove the bill, I urge the Congress at its earliest opportunity to enact new legislation without retroactive effect.


Dwight D. Eisenhower, Veto of Bill Relating to Unemployment Tax Credits of Successor Employers. Online by Gerhard Peters and John T. Woolley, The American Presidency Project https://www.presidency.ucsb.edu/node/234571

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