The Washington herald., 1912-07-30
The Excise .Tax Muddle.

The Excise tTaX Middle.
The excise tax on. interpretations must
be one of the regrettable things of the
present administrations appears from
the fact that il is not ,pointed to with
anything approaching pide in the Re-
publican national platform, and as no
suggestion is made for widening its
scope; while, on the othe1 hand, the
Democrats, in their platform, seize the
opportunity to congratulate themselves
upon the enactment by the Republicans
of what had been Democratic demand
for an income tax.
The excise tax is but another word
for income tax upon corporations But
a tax upon individuals can hardly be
supported by arguments favoring such
a tax on the former. This is plain.
The Federal government has something
to give the corporations in interstate
commerce in return for its demand Tor
= an income tax But the privilege of
doing an intrastate or interstate busi-
ness by individuals or copartners is an
inalit1sble right recognized by the Con-
stitution; in fact, it existed before there
was any Constitution, and independently
of it. How could the Constitution have
been adopted if it had been argued that
it would create obstacles to doing busi-
ness in a free country and was author
izing a tax on the right to trade, apart
from a regular constitutional tax levied.
We know that the argument in favor
of an excise tax on corporations is not
pleasing to all. This is clear from the
use of the word excise" in order to
create the impression that it is not a
tax on income, but one measured by i'll
comes. Well, then, a direct tax on in
dividuals or partners does not cease to
be a direct tax because it is calculated
in a certain manner. and it is called
an excise tax to avoid the constitutional
requirement for apportionment by popu-
lation.
The intent of the act is to levy an
income for the privilege Of doing
business" At least this is the way the
meaning is understood, but why the
man only is to be reached who does
no business, who lives from trust
funds, or rents, or dividends, or sal
aries, &c, it is not 50 easy to follow.
Il is well enough to tax wealth This
newspaper would be the last to say
word against that, but that is not the
question at issue. Do it legally, or do
not attempt it at an. 1t seems to us
and has seemed so all along during the
former income tax controversy that the
States have a clearer right to gather
such taxes than the nation, and thus
the individuals or partners will be sub
ject TO double taxation If the States
should go in for doing what the Federal
bill now has done
Either the two things are the same
or there is risk that the national gov
ernment may finally collect both an
income and an excise tax, meaning that
any individual may be taxed three
times for the same property. namely:
State-income, Federal-income, and Fed
eral-excise tax. In war times this
might be taken on our shoulders as
an emergency measure to save the ma
ton; but in times of peace II is no.
body's duty to pay either, all excise or
an income tax, especially III such mix
up of the law and lineup between
States and nation for the identical
privilege.
When first introduced it was alleged
tha: the principal purpose Of the excise
bill was 10 supply source of revenue
which would enable the government to
dispense with the duty on sugar, but
in the meantime, the sugar bill, as
passed Saturday in the Senate, does
not attempt to eliminate the sugar duty,
but reduced it by very small margin,
with a joker attached that makes the
reduction quite valueless. The sugar
duty is one of the most burdensome
to the consumer. As means of dis
pensing with it the excise act might
have a justification, but as the sugar
duty remained, even this last leg to
stand upon is taken from under the ex-
else or income or whatever name you
may give this new Federal tax upon
the individual