Barbour County index. [volume] (Medicine Lodge, Kan.) 1880-current, 1909-07-28
The Corporation Tax


If MIR. Taft were not president we
would say that this proposed corporation
tax scheme is mischievous legislation.
1t is following out to the logical con-
clusion the spirit Of attack on corporations
which has been prevalent for some time.
1t is a tax on the incomes of corpor-
rations and it is unjust in this respect,
that it lets the large private income go
untaxed. 1t Is a declaration that an in
income earned by an incorporation COM
pany shall be Disseminated against, while
the income Of the individual shall be i'm
mune, no matter how large that income
is. 1t is legislation based on prejudice
IN ] it is a violation Of the fundamental
principle Of taxation that all forms Of
p operty shall be taxed equitably and
equally. 1t is furthermore legislation to
make political capital Of, not primarily to
raise revenue.
Itis cheap political makeshift to
p rchase forgetfulness Of the fad that the
effort at honest tariff revision has been
defeated by those interests which grow
fat of the inequalities of the present
tariff schedule.
Briefly stated, the plan imposes a tax
Of two per cent upon the net earnings Of
every corporation, joint stock company
or association, organized for profit and
having a capital stock represented by
shares.
Every corporation is given an exemp-
ton of $4,000 Of earnings before the
tax shall apply.
There is also deducted any tax paid
to the state or the United States.
On the surface this seems to be an
attempt to secure revenues by making
the corporations pay for the privilege Of
Incorporating. To illustrate: John Brown
and James Smith organi re state bank
with capital stock Of 100000. dvid-
ed into shares. They make a dividend
of 8 per per cent for their stockholders,
which means $4,000. The federal gov
eminent slips in and deducting $4,000.
demands two per cent on S 900, or
500.
Tom Jones starts a state bank in the
same block with a capital Of 5000. 900,
but he does not incorporate. He owns
all the Stock and enjoys all the profits.
He makes $4,000 net and the govern
ment doesn't ask him to pay any tax.
By neglectins to incorporate he benefits
500 over his competitors in the same
block.
Tom Jones sits on the curb and
chuckles to himself as he hurls another
brick at the greedy corporations, and if
he has political aspirations, he may graft
fly his ambition by pointing to the cormo-
rants under charter who groan and pro-
test against supporting this grand old
government with paltry tax.
Apply the same reasoning to depart
ment Stores, -four mills or other concerns.
where one incorporates and the other
doesn't, and see how inequitable and
unjust such a tax is.
1t pretends to tax the rich, but lets the
100000 banker go while assessing
the building and loan association in which
hundreds Of men whose incomes are less
than s 900 per annum, are Interested.
Their dividends are crippled in a two
per cent tax on the earnings Of the asso-
citation over and above $4,000.
The income tax is infinitely fairer be-
cause that fairly hits all whose income.
are above a certain amount, whether
they do business as a private or as a
corporation.
/ The house should defeat the corpora
ton tax and demand an income taz
amendment in its place. If the corpo.
ration tax is constitutional then certainly
the income tax is.-Wichita Beacon