The Washington herald. [volume] (Washington, D.C.) 1906-1939, 1913-06-08

he will pay to his county and State all
Of his property taxes as heretofore"
IF should buy farm for $4,000 ana
sell 1t for $4,000" the man continues.
would be taxed on the gain thus
NADER
Dealers in real estate" Mr.. Hull ex
plaina ARE required to ASCERTAIN their
profits year by year and pay the normal
tax Of per cent on the gains which ex.
coed $4,000. 1t is the same with mer-
chants. contractors, and all men engaged
In unincorporated business. either by
themselves or In partnership. Private
dealing In real estate, IL may use that
term, 10 another matter. A man buys a
house and lot, let us say. He sells 1t
ten years later and makes 5000. The
money would not be taxable as a part
Of his income. II has become capital.
you see, and II called anything must be
Jumped into his estate under the name
Of unearned increment"
The Fact About stocks.
I'D like to put q hypothetical ques.
ton" says a slim. oldish man in black,
as he fingers his watch-chain nervously.
1T doesn't concern any person in par
ticular. and least of all myself. "a score
or more of his acquaintances are wink
ing at one another and several are stand
ing up and have their hands behind their
ears). Let US say" the oldish man con-
tinpes, that somebody has 1000 shares
OF stock. We shall call 1t preferred stock
Of the United States Steel Corporation
That concern. strangely enough. has just
popped into my head. L might have said
he owned 1000 shares of some other cor
poration. But steel II was and steel I'll
call It. Very well He draws an annual
dividend of 5000 on the stock. That's
whole lot OF money II one was so
fortunate as to have II. Would he. would
this hypothetical shareholder. pay an in
come tax on S3,o00?'' ....
He would not pay 1t directly Mr..
Hull answers. CThe slim, oldish man
looks relieved. The men who were
standing up sit down heavily. II said
some time ago." Mr.. Hull goes on, that
all corporations are taxed on their net
earnings by the national government.
The man OF whom you speak-and he is
not present, of course-having an in
come of 5000. and having had his tax
Of per cent paid by the corporation on
its net earnings Is not required to pay
a tax himself His tax has been COL
lected at Its source, as the phrase goes.
He would not pay a tax. consequently.
on the income he received from steel
shares or the shares of any corporation
unless his annual dividends from all
sources amounted to more than $4,000.
II his separate dividend on the shares
OF the corporation. or IL the aggregate
OF his dividends from all corporations
amounted to more than $4,000 and to less
than $4,000 a year, he himself would
pay an extra tax OF / per cent If his
income were more than $4,000 a year and
less than 800 900, he would pay an extra
tax Of per cent. II his income were
more than $4,000 a year, his extra tax
would be 3 per cent Beyond S2O,Uo the
tax is graduated according TO the amount
OF the income
The Old Man Drops a Hint.
"In other words" the slim, oldish man
calls out in a piping voice, you are tax
ing a few Of the people for the benefit Of
the many. Aren't you afraid that the
few who pay the taxes will finally get
control of the government? I'd be. IL
were in Congress-
WELL" Mr.. Hull replies. I'VE are will
irg to take the risk. II hasn't worked
out that way in the States The large
payers OF property taxes there complain
because burdens are constantly being
voted on them by the small tax-paying
and the nontax-paying majority IN every
community"
How many persons will pay tax on
incomes asks a positive and statistical
man. pointing a lead pencil toward the
platform
About 10000" Mr.. Hull answers 'In