The evening telegraph. [volume] (Philadelphia [Pa.]) 1864-1918, 1869-07-27
THE INCOME TAX-ITS REPEAL o.
AMENDMENT?

form of taxation has from the first encoun-
tered. 1t is declared to be odious and OPP
pressive. 1t is stigmatized as inquisitorial,
as an encouragement TO fraud, and as a bur
den which should not be allowed to continue
beyond the period fixed by the present law.
Many of our contemporaries demand its re-
peal at the next session of Congress; insisting
that an equal amount of revenue may be
raised from other sources with less vexation
and embarrassment than are occasioned by
the tax assailed.
The unconditional repeal of the tax may be
assumed to be out of the question. What it
will yield in the present year remains to be
ascertained. Last year, however, its product
exceeded forty millions, and in 1867 was more
than sixty-four millions; either of which
amounts exceed the probable saving capacity
of the Treasury, considered with due refe-
renee to other phases of fiscal reform. The
immediate abolition of the tax, unless fol
lowed by the imposition of a corresponding
burden in some other form, we take to be
impracticable. And in what other form
may forty millions of Taxation be made
more acceptable? The industry of the
country cannot conveniently bear it. Manu-
facturers, according to their, own show
ing, are taxed to the extent of their capa-
city, and to a degree which seriously impairs
their ability TO compete with the most formid-
able rivals. The tariff, again, has reached a
standard which renders additions in that direc-
ton impossible. And as for the taxes on
whisky and tobacco, they are now quite heavy
enough for the interests of the Treasury.
Where, then, shall the national fnancier look
for the extra forty millions which the removal
of the income tax would compel him to ac-
quire? What branch of production or trade
can be reasonably expected to assume this
further load in order that the 'odiousness'
of the income tax may be averted? Reduce
the inquiry TO this single point, and the great
obstacle to the total repeal of the tax becomes
apparent.
But effective retrenchment, coupled with
the more efficient collection of the revenue,
may enable the Government to dispense with
forty millions annually. Perhaps so. And
supposing this pleasant condition of affairs to
be attained, undoubtedly a reduction of
taxes should take place. The country needs
as much fiscal relief as may be had without
detriment to the public credit; and if the
experience of the current year warrants the
belief that a considerable surplus will be
available. we think that its reduction by the
diminution of taxes is preferable to any ap-
plication of it that has been devised. With
the Just claims of the public creditor pro-
vided for by compliance with the terms of
the Sinking Fund act, it would seem that the
best use for any excess of Treasury strength
is the abatemect of burdens which only abso-
ute necessity has rendered tolerable.
Granting that reduction of taxes to the
amount of forty millions may be found prac-
ticable, the soundness of the policy that would
sweep away the income tax, and so limit relief
to a single channel, may well be questioned.
For there is this to be said in behalf of the
income tax, it falls only upon those who, as
compared with the mass of the people, are
able to bear it. The great body of manual
workers, and all in receipt of less than thou
sand dollars annually, escape its operation.
TO these-and they constitute the bulk of the
community-abolition of the income tax
means nothing more or less than benefit to
the classes better off than themselves, while
the taxes from which all suffer would inevi-
tably be continued. The taxation that may be
most equitably dispensed with is that which
falls upon necessaries of life. Articles of
universal consumption are at present heavily
burdened, and the fiscal reform first needed
is one that will mitigate this burden, and
thus confer a substantial benefit upon the
main body of the people. A revision and re-
duction of the tariff with special reference
to the removal of duties from commodities
which enter into the expenditure of every
family, would confer greater and more uni
form benefit upon the people than can be OBJ
tanned by the repeal of the tax on incomes.
But while we consider income-tax repeal
impracticable in the present circumstances of
the country, there can be no doubt that it's
modification is desirable as we'll in the inte-
rest of the Treasury as of the public. A uni
| form tax of five per cent. is too high. 1t in
| creases the temptation to fraud, and operates
harshly upon the possessors of small incomes
derived from labor or trade. 1t should be re-
| duced to two and half per cent on incomes
below some fixed figure, or on all in
comes derived from industry or trade, as dis
| had 1i1a
property. Whatever injustice there is in
the tax as now levied consists in total
| disregard of the essential popularity of in
comes which are contingent upon the acci-
dents of employment and health or the
vioissitudes of ever-varying competition. The
clerk or the professional man, whose income
may cease any day, or the merchant, whose
profits of this year may be swallowed up in
the losses of the next, are required to pay the
rate that is paid by the retired capitalist or
real-estate owner, whose incomes are as cer-
tain as anything human can be. The anomaly
is so glaring, and the hardships it inhicts are
| so cruel, that its continuance is indefensible.
! 1t might not be. fair to exempt one of these
classes from the tax while retaining il on the
| shoulders of the other; but some discrimina.
tion is called for with the view of relieving
what may be called contingent incomes from
a load which incomes that are certain are
abundantly able to carry. A reduction of the
tax to half the present rate, in the case of the
former, should not be delayed
The loss to the revenue resulting from this
reform might be partially covered 10y revi-
sion Of the list of exemptions especially in
the item of rent. Mr. Wells has pointed out
the abuses to which this exemption has given
rise, and also the inconguities to which il
leads. The law should define the maximum
| at Nt-fEyg I L, .Igk