Evening star. [volume] (Washington, D.C.) 1854-1972, 1910-02-16
GERMAN INCOME TAX
Difficulty in the Way OF Max
ina Just Assessments.
MANY RETURNS INCORRECT
Interesting Experiment Proposed in
Hamburg.
TREATMENT OF IMPORTS
Exclusion of Some American Food
Products and Severe Restric-
tions on Others.
BY WILLIAM r. CURTIS.

BY WILLIAM f. CURTIS.
Written for The Star and the Chicago Record
Herald.
Consul General Robert P. Skinner at
Hamburg. who is recognized as one of the
ablest men in the service has been send
ing some very interesting dispatches to
the Department of State lately. and, like
all Of his reports, they are not only in
teresting, but apropos. One of them re-
lates to an interesting experiment at
Hamburg for the purpose of protecting
the land-holding element of the popula-
ton against being compelled to bear an
unfair share of taxation. This question
was brought up in the discussion Of the
budget in the British parliament on a
proposition to impose tax upon 'the un-
earned increment"-that is. the unt evel-
oped resources of the country. such as
coal and other minerals. On the one side,
it was argued that If such wealth was not
taxed 1t would remain undeveloped. On
the other hand. if 1t were taxed the own
ers would be compelled In self-defense to
develop it. and would thus furnish labor
for the unemployed and add to the pros
perity of the country.
Inaccurate Returns.
Mr.. Skinner in his report says: 1.-The
chief sources of revenue Ii Germany are
the income tax. and various state govern
ments have as many methods of laying
the tax. While this form of taxation is
equitable in theory, it is discovered in
practice to offer a good many loopholes.
so that even in Germany 1t is found that
the determination of the taxable income Is
not without serious difficulties. Some
sets of books tell too much. others too
little while some are NONRESIDENT. and
that. finally. it is necessary to have
boards OF experts to estimate and level
up. so that instead of mathematical ac-
curacy in respect to taxable incomes We
tanned by the. Introduction Of testimony
and the application of a sort of law OF
average. Thus. of Jag. 4O3 persons whose
incomes were reported as taxable In Ham
burg in 1908, 24.36S returns were reported
as probably not accurate and 1913 were
proven to be so: while in 967 cases it was
found that this inaccuracy Of statement
had continued during a series OF years.
Now, while the basis for the assess
ment of the income tax is the income of
the last preceding year. ordinarily such
taxpayers as carry on a continuing bus-
ness, and who. therefore. keep books, cal
culate their taxable income on the basis
of the average for the three years pre-
vious. 1t was found that many persons
within these three years were thus
obliged to report for taxation very large
amounts sometimes realized from the
sale of land or real property, which bore
no relation TO the general average OF
their income, and which compelled them
to pay at certain times q total tax out of
all proportion to their actual condition
of living. Thus, business man. In mod
est circumstances, who happened to sell
a house for $4,000 in 1900. found himself
obliged to enter this $4,000 as an element
in his average income, in three success
Siye statements.