The Boise citizen. (Boise, Idaho) 1906-1910, 1909-07-02
THAT CORPORATION TAX


To all appearances the of the proposed federal tax on
corporation earnings generally understood Most people
seem to identify with the placed on net corporation incomes
in connection with the individual incomes income tax law
Of 1894 which overthrow United States Supreme Court
in On the contrary there important differences
to observed The corporation may in the same way
in both cases. the results will necessarily be radically different
when applied without individual incomes from what
they will be when the is applied with general
income tax.
Let it said the that little justification exists for
tax corporation incomes when government taxing nd
vdua First last all corporation find their wav
to pockets and there certain amount
and the taxed in the hands corporation and
again when reaches the individual taxation of
no essential bearing upon the effort super
huos wealth bear its fair share the support government
this pass The point be considered that tax
simply corporation earnings income involves injustice
presents broad opportunity for evasion which wanting
applied connection with general individual The
njustces manifest The boaed bondholder in this
capes altogether when Individual incomes
The all the risks uncertainties of corporate
business be taxed under the Taft pan while the
poses upon all its certaes exempt Risk ownership capital
corporate undertakings taxed while the kind of capital
partnership undertakings is Mutimonares like Mr.
Carnegie wealth mostly in bonded investments go
while the of than share OF stock any paying
corporation taxed The of justice outraged by
any such proposition.
Great however this objection is another of serious
character be consdered-the opportunities offered for
applied along with individual income tax The smaller cor
poratons the Taft plan quite easily dodge the whole levy
and all that involves by simply dssovng into partnership form
Of doing Corporations of only few stockholders
easily places them the management of the company and
pay the salaries Operating expenses what would otherwise
go dividends Similarly individual income
lies in the outside of the corporation under
the Taft pan incentive within the corporation increased greatly
find other ways dertng earnings before they reach the form
to be made taxable by the proposed scheme
plan must espionage the affairs of all bus
corporations direction of the bookkeeping and account
ing which would be unnecessary the OF general income tax
If the be imposed with any degree OF fairness at all as
between stockholders the several corporations federal ac
will placed every corporation coun1ngoo
throughout the country The President said not to believe TINS
but his of corporations H. K Smith, who has been
having some experience of corporation accounting
quoted as declaring that keep the corporations line and
prevent their evasion would require force OF special
agents large the standing Army the United
States And Mr. Smiths practical knowledge OF the requirements
of the doubt be placed above ha OF the president
And all this merely behalf of raising more than S5oOo
600 Federal against yearly total now collected OF
SS00O00O00 Surely of the most extraordinary hsca PROPOSE
tons presented by the responsible public authority Revenue
obviously cannot be its chief purpose
What then should be done The question OF additional
easily determined The best course to pursue Wo
be impose general income the Democrats and SuSe
Republicans propose with say additional and temporary stamp
to make up the deficit pending reheafhg o W "
come question before the Supreme court Even IA
poraon dividends (as distinct earnings ncoe)
much to be preferred temporary measure to this PoPeu pan
for while Objectionable the grounds of equity 1t couu DC "
eed with very little trouble expense II 1t IS deemed
presume greatly upon reversal by the Supreme court o 10
judgment then the nroprane OF constitutional amendment fo al
income could be followed with the substitution OF stamp
corporation dividend for this scheme OF the
dent, a temporary measure.
Then granting the need closer Federal control o1 cop
engaged in Interstate Commerce let question be dealt WITH
itself Why force it into tariff and revenue discussion! why