The Hawaiian gazette., 1896-04-17
7. H. Davies Enters the Arena of
Taxation.
HOW ENGLAND MANAGES IT
perly- Relieve Coffee Planters From
Unnecessary Burdens-Inequality of


of the hour, and it is question which
is of vital interest to every citizen of
every country. For years it has been
my conviction that if there was one
country better suited than another for
the laying of an income tax, that coun-
try was Hawaii; but l have usually
been met with the assertion that the in
come tax was too inquisatOrial for in
PRODUCTION here. For myself, can con-
ceiye of nothing more inquisatorial,
more unfair and more generally unsat-
isfactory than the present property tax,
even as it is proposed to be, with a
number of vexatious and apparently
more or less vindictive licenses on the
small tradesmen.
The cutlery against the corporations
and firms which conduct so much Of
the business of the country, on the
ground that their capital exceeds the
amount upon which they are assessed,
is absurd, because the law distinctly
provides that all property that can be
got out of the country by the 3Oth Of
June, or that can be kept out of the
country until the I'd of July, shall be
exempt from taxation. No change in
the date OF assessment will alter the
fact thai this property, which is not in
the country upon that date, will be free
from taxation and every business house
will govern itself accordingly.
The inequality of the present tax is
manifest when we see that a man who
invests his capital in feed and flour,
and turns his stock over every sixty
days, can plan to have nearly all his
property out of the country when as
sessment day comes; whereas one who
invests the same amount in cement or
railway iron may find his stock on hand
and assessed from one year to another.
The income tax is based on the prin-
ciple that every man should contribute
to the expenses of the nation in pro-
portion to the income which he receives
under the protection of the nation. An
income tax would find every single man
and tax him fairly, and / venture to
think that good many besides the
bold, bad sugar barons" would realize
the change.
The ordinary rate in England is six
pence in the pound-say 22 per cent
on every income. All incomes not over
$500 are exempt, and all incomes not
over $4,000 are allowed an exemption
of $500. No man pays twice on the
same item, and the procedure is as fol-
lows:
First-Corporations pay 2R per cent.
on all their dividends and interest
bonds, and the proportion is deducted
from each share or bond holder
Second-Business houses pay on each
years profits; or if they prefer, they
pay on the average profits of the last
three years.
Third-Every householder and other
assessable individual pays on the in
come he receives from every other
source than those which have paid I'M
der First and Second.
Persons living out of England pay
the same tax on income arising in Eng !
land as they would pay if living in Eng |
land, and on this principle even the |
sugar barons" would be caught, as
they deserve to be. No officer of the |
army or navy, no government official at |
home or abroad, escapes the income |
tax. The doctors and lawyers, and even |
the well-borers, pay on their incomes
instead of on their property, and this |
seems to me to be more equitable than |
licensing and taxing men whose prop
erty, in spite Of their industry, brings
them no income
There are two principles which in
n GLAND orda ;aI
ciples with the income tax.
First-The tax list is absolutely con-
idential and kept secret.
Second-Whatever rate is fixed ap-
plies to all incomes, except the exemp-
ions have named. Otherwise a small
holder of shares in large corporation
night be unfairly taxed because there
we're many larger holders of the same
shares.
Besides the income tax, there is a
and tax, payable by the owner as ds-
inct from the occupier of land; but I
I'm not familiar with its provisions.
If an income tax were levied here. /
should suggest that corporations pay
IN an average of the dividends of three
ears, so as to equalize the revenue;
llso | would recommend that incomes /
Up to $4,000 be exempt, and that in
ONES up to $4,000 be entitled to a de- 6
uction of $4,000.
In order to meet the Chinese and
apanese difficulty, it might be neces-
airy to allow them the option of keep
ng their accounts in English or of pay
ng the property tax as heretofore.
| am confident that an income tax
rould be found very much simpler than
he present system; and being based d,
pom figures rather than upon esti-
mates, it would obviate much of the
riction, the disputes and appeals that S
haracterize the assessment of the q
roperty tax.
There are struggling men and BOYS.
onestly and earnestly putting their !
fe and strength into coffee lands. and
very stroke of work they put in adds :
, the property" for which they are to
e taxed. and they will have to borrow [
ne money to pay the tax. Surely a O
roperty tax is cruelty and a mockery
, such men,
| am, sir, your obedient servant.
THEO. H. DAVIES.