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involving voluntary election, and (2) there cannot be any direct refund of what, in a private pension plan, would be called contributions.

As to the first of these important consequences, it is a well-settled principle of the law of taxation that, to be valid, a tax must apply equally to all the members of a class, and that the classification itself must be a reasonable one.  In the case of social security taxation, defense of a tax by resting the classification on the receipt of a benefit would be self-defeating, because it would negate the separation of benefits from taxes. Therefore, the classification must be based on something else--and it can readily be seen that a classification based on industry is the only one available. In the proposed pilots' system, the tax classification is based on what may be called a sub-industry. Whatever the scope of the classification to which the tax applies, it would be no more legal for a person within the classification (whether the person be an individual or a corporation) to decide not to pay the tax when it would be legal for that person to decide that, though his income in 1948 was $25,000, he would not pay any Federal income tax. In the case of taxes like the usual social security taxes, it would be an even greater departure from valid legal concepts to have the tax on the employer apply only if and to the extent that his employees chose to pay the tax. It is clear that payments made to the Federal Treasury under such an arrangement would not be taxes; and if they are not taxes, a basic underpinning of Congressional legislation in this field would be gone.

As to the second proposition, it is clear that if a tax properly collected is refunded, the end result is the same as if no tax is paid. Therefore, a refund must be based on the same kind of reasonable classification as the original tax. The refund of a tax, levied on a person because he possesses a particular characteristic, is not made valid by reason of a loss of that characteristic. A tax levied because a person's income exceeds a certain figure is not refunded because at a later time his income drops below that figure, or disappears. A tax paid by a person in order to practice his profession or calling is not refunded because he enters another trade.

The benefits under the benefit statues are sometimes measured by a percentage of compensation of individuals approximating the percentage of the compensation by which the tax of such individuals was measured. The arrangement is sometimes referred to as a refund of taxes, but it is not. First, except for a brief period under the Social Security Act, before annuities became payable, no such payment is made to the person who paid the tax. Under the Railroad Retirement Act, such payments are made only to survivors. In any event, payments under a statute of the kind involved here must be for a purpose related to social insurance. A payment to an air line pilot who decided that he liked to sell insurance more than he did flying would not fall within an admissible category. A payment to a pilot who stopped flying because he was laid off permanently as a consequence of reduction in the volume of air traffic would fall within the proper sphere of a social insurance statute--but one providing unemployment insurance and not old age, or disability, or survivor's insurance. And an unemployment insurance payment related, however indirectly, to taxes paid for some other form of insurance could scarcely be defended.

The following set of questions and answers has been prepared to convey an idea of the major features of the poilots^1 retirement system. It is not exhaustive, but it covers at least one aspect of the essentials of the system.