The Pacific commercial advertiser. [volume] (Honolulu, Hawaiian Islands) 1885-1921, 1896-04-30

provisions, and it will doubtless re-
tainIy merits. There are one or two
points in connection with this bill, and
with the principle of an income-tax gen
orally, to which l think that atten-
ton should be called, and l will, with
your permission, briefly refer to some OF
them.
Governments and Legislatures exist
not to worry the rich or to Cypress
the poor, but as trustees for every man,
woman and child in the land; and
whereas the fines and penalties of
police court are intended to be as OBJ
iectionable as possible, the assessment
of the peoples taxes should be made as
simple and as unburdensome to indi-
viduals as is consistent with the inter
ests of the whole nation.
A direct tax, like the income tax, may
be made very troublesome to assessors
and assessed, and it is the province of
the Legislature which imposes it to
avoid as far as possible all causes of
friction Mr. Winston proposes that
should be taxed. That is, improve
ments, extensions and other better
ments. This would be the cause of
endless difficulty, for it is impossible to
distinguish clearly between repairs,
working expenses, and Improvements
in machinery or buildings. For in
Sou. fJ,I, Of
sugar from the vapors passing from
vacuum pans and other vacuum evap-
orators is being put in some mills at
cost of say $500. 1t is expected to save
more than its cost in single crop. The
tax on the amount saved will be more
than the tax on the cost, but it would
not be fair to tax BOTH when the income
is really only the amount received. If
a profit is taken, it should te taxed, but
if it is added to the inve ;tment it is
not income, but goes to produce in
come. My proposal would be to fix the
rate at whatever is necessa ry, but let it
be levied only on dividend and bonuses
and interest payments, respect of
corporations. The shaj holders will
see that these are not unduly kept back,
and even if they are unduly delayed
in one year they must appear in the
next year. Upon this system there
never could. be a dispute and there
could be no use for an appeal board
The same system would hold good in
private business. The balance of profit
and loss is the income of the principal,
or partners and all salaries are assess
able separately. The partners also
would have to make individual returns,
to embrace such income as did not |
arise from dividends or profit in bust |
ness. These would include interest, al |
lowances and other special items. The |
simplicity of the operation depends on |
it being tax on bona fide income |
Another point l would urge is that to |
avoid the violent fluctuations which |
good and bad years in our crops pro-
duce, the tax on sugar plantations, if |
not on other industries, be based on an
average of three years income A plan
tation might easily pay $4,000 one
year, $4,000 the following year. and
nothing the third year, making an aver
age of $50 900 for taxation in each year
1t would be much better for the Treas
ury to have it's revenue thus equalized
Mr.. Winston has steered clear of
very fascinating but very dangerous
rock against which Mr.. Gladstone, one
OF the greatest financiers, SteadfaStly
warned his countrymen. / mean the
graduated or progressive income-tax.
1t sounds we'll to say, "Let us lay the
burdens on the rich, who are best able
to bear them That is the beginning of
socialism and of the doctrine that the
masses should levy tax and the few
men should pay it. Make liberal ex-
emptions for the small incomes. but let
there be one rate for all who pay. Fur
thermore, it would be manifestly unfair
to tax poor man who happened to
have share in large plantation more
than you would tax another man who
had his share in small plantation,
that gave both the same income.
The last point is the tax on alb |
sentees- You cannot tax absentees.
You may get round it by making spe-
cial allowances or exemptions to people
who reside in the country, but if l OWE
a hundred shares in a plantation, you
cannot tax my shares more than any
others, wherever l live. An absentee
AK is intended to apply to men who own
large unimproved tracts of land and
who leave them to increase in value for
uture sale. These men ought to be taxed
f possible, but there are no such men. J
and no such tracts of land in Hawaii
The ordinary income tax requires spe-
,ial application in the cases of real
estate, and if the whole subject is calm
Y and carefully dealt with am salts j.,
led that absenteeS and sugar baronS
will pay their share of the taxes man
ully with the best and bravest.
L say again, let the assessment and
he collection be made as simple and S
to individuals as is con-
isteut with the interests of the whole
ation L am, sir, your obedient SER 4
ant, THEO. H. DAVIES,
Craigside, April %, 1896.